Iranians fret and lawmakers demand answers as rial plunges

Iran-currency

TEHRAN -- Homayoun Hashemi had imagined visiting his daughter, off studying in the United States. But as the value of the Iranian rial plunges, that trip is steadily slipping out of his reach.

“Now my wife and I are almost forbidden to go visit our daughter,” the 60-year-old engineer lamented. “The trip is not affordable.”

As Iran is pressed by Western sanctions over its disputed nuclear program, the beleaguered economy is putting added pressure on ordinary Iranians through inflation and triggering pleas for the Iranian central bank to step in.

Iranian media reported Tuesday that the economic minister was summoned to a closed session of parliament to explain why the currency had dropped so dramatically, plunging in value compared with the U.S. dollar by roughly half in a year. One lawmaker accused the central bank of cutting off the flow of dollars to Iranian traders in recent weeks, making "the biggest mistake in history," Reuters reported.

Outside of government halls, the tumbling rial has Iranians changing their plans. For Nima, a 25-year-old with a British engineering degree, it means downgrading her dreams of seeking another degree abroad in management, perhaps in Canada or the United States, to daydreams.

The price would be “neck breaking,” she complained. “All my educational ambitions vanished in thin air thanks to the local currency depreciation.”

Hamid Methghali, tending a shop in a Tehran flea market, fears losing his home. “I am desperate  because my landlord may come next month to increase the rent,” the 49-year-old Methghali said, fretting because 10,000 rials were traded for a dollar when he signed the contract.

The Iranian currency hit a record low on Monday, with some street money changers pricing rials as low as 27,000 per dollar before police cracked down on the illegal dealers Monday afternoon. The value had reportedly bounced back slightly on Tuesday, according to the tracking website Mesghal.

The street value of the rial is much lower than the official rate used by the central bank for essential purchases, now at 12,260. “I am worried,” a seasoned black market dealer named Esmaeel said of the devalued rial. “We’ll buy more expensive goods tomorrow. The future is more murky.”

The toll of soaring inflation and other economic woes can be seen in the growing number of Iranians unable to pay their gas bills. The national gas company announced that it would cut off supplies to subscribers who had failed to pay, the semi-official Iranian Students News Agency reported Saturday. The company is owed over $675 million, managing director Javad Oji said.

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-- Ramin Mostaghim in Tehran and Emily Alpert in Los Angeles

Photo: The value of the Iranian rial hit an all-time low compared with other currencies on Monday. Credit: Behrouz Mehri / Agence France-Presse / Getty Images

 
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