DUBAI (Reuters) – The slump in Iran’s rial will be temporary, Iranian President Hassan Rouhani said on Tuesday after the currency sank to its lowest ever before recovering slightly.
A U.S. dollar was offered for about 205,000 rials in morning trade on Tuesday, up from 188,200 rials on Friday and 198,000 rials on early Monday, foreign exchange site Bonbast.com, which tracks the unofficial market, said.
The Iranian rial firmed to 198,200 against the U.S. dollar in later trade on Tuesday. The official rate, cited by the central bank website, is 42,000.
“The shock created in the foreign exchange market is temporary and has no fundamental economic reason and balance must return to the exchange market,” Rouhani was quoted as saying by Iran’s state TV.
The latest fall comes four days after the U.N. nuclear watchdog urged Tehran to stop denying it access to two suspected former nuclear sites.
Iranian authorities have dismissed as “an exaggeration” the rial’s slump following the watchdog’s resolution, which has raised diplomatic pressure on Tehran.
“Psychological warfare against Iran as well as the creation of an unrealistic anxiety among people, are the main causes of the recent fluctuations in the foreign exchange market,” Rouhani said.
In 2018, President Donald Trump withdrew the United States from Iran’s 2015 nuclear deal with six powers and reimposed sanctions on Tehran that targeted its main source of revenue – its oil exports – and its financial sector.
The global oil market has been hard-hit by demand destruction because of the COVID-19 pandemic, while Iran’s oil revenues had already contracted because of U.S. sanctions.
Iranian authorities said last week the country’s oil revenues fell to $8.9 billion in the year to March, versus $119 billion in 2011, Iranian media reported.
Iran is one of the countries in the Middle East worst affected by the pandemic, with 209,970 infections and 9,863 deaths, Iran’s health ministry said.
(Writing by Parisa Hafezi; Editing by Alexandra Hudson and Barbara Lewis)