Iran’s national currency has plunged to its weakest level on record on Tuesday, according to a Reuters report citing websites tracking the currency. Over January, the rial depreciated 5%. Rates briefly touched 1,504,000 rials on January 27, marking a sharp daily drop, and some outlets have reported spikes as high as 1.65 million.
According to ABP News, analysts attribute the collapse to a convergence of pressures: sweeping international sanctions that have throttled oil exports and dollar inflows; runaway inflation that exceeded 42% in December, with food prices up more than 70%; and government policies that removed subsidized exchange rates, making imports far more expensive. The International Monetary Fund projects inflation will climb by about 40% in 2026.
Public confidence has also eroded. Many Iranians are converting savings into dollars, gold, or property, further weakening the currency. Regional tensions, including the impact of war and friction with Israel, have compounded economic anxiety.
Up to half of Iranian population living in poverty
The consequences for ordinary people are stark. Essentials such as food, medicine, and clothing have become increasingly unaffordable, while the minimum monthly wage has fallen to roughly $100. Poverty is widening, with estimates suggesting between 22% and 50% of the population now lives below the poverty line.
The downturn helped spark protests in late December that quickly broadened into demonstrations against Iran’s religious and political leadership. Authorities responded by cutting internet access and deploying security forces.
Human rights groups describe a brutal crackdown. The US-based Human Rights Activists News Agency (HRANA) says it has verified 6,126 deaths, and recent estimates reported by The Guardian put the number of casualties at over 30,000.