Iran's rial weakened further on Saturday even after the central bank moved to sell up to $2 billion to defend the currency. The rial has now lost more than half its value over the past year as US sanctions and a naval blockade squeeze the country's oil exports.
Iran's rial continued its decline on Saturday, slipping to a fresh low even as the central bank stepped in with a fresh defense of the currency. State television said state banks began selling up to $2 billion to support the rial, but the intervention failed to stop the slide.
The US dollar traded around 2.688 million rials, up from 2.632 million on Friday, according to free-market tracking website bon-bast.com. A separate tracker, alanchand.com, put the rate at 2.695 million rials per dollar. The currency has lost more than half its value in the past year.
The decline comes as the economy faces US sanctions and a naval blockade that cuts the state's financial lifeline — oil exports. With an inflation rate of more than 70%, life is becoming tougher for ordinary citizens unable to afford basic necessities or rent. As a result, many Iranians seeking safe havens for their savings have been buying dollars, other hard currencies, or gold.
Mehdi Darabi, an aide to the central bank's governor on foreign exchange affairs, blamed the rial's decline partly on what he described as false predictions by US officials of the collapse of the Iranian economy.
Source: Forex News
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