DUBAI - An Islamic trade association in Iran strongly condemned the protests that flared in Tehran's main bazaar as an enemy conspiracy and said traders had dealt with the "treacherous" acts, Iran's state news agency reported late on Wednesday.

Riot police clashed with demonstrators and arrested money changers in Tehran on Wednesday afternoon in disturbances over the collapse of the Iranian currency, which has lost 40 percent of its value against the dollar over the last week.

The Iranian economy has stuttered badly since the start of the year as tough sanctions imposed by the United States and its allies targeting Iran's oil exports and banking sector have resulted in higher inflation and a surge in unemployment.

"A number of suspects linked to the enemies of Islam sought to close the market by creating fear, but fortunately Muslim merchants rose up and stopped the conspiracy," the Society of the Islamic Associations of Tehran's Guilds and Bazaar said in a statement.

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