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By Amir Daftari
News Reporter
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Iran's currency has hit a record low as toughened sanctions under U.S. President Donald Trump and the absence of nuclear talks with the United States deepens economic uncertainty.
The rial was trading 1,030,000 against the U.S. dollar as of publication time, below the psychologically significant level of 1,000,000 rial per dollar. The currency has lost half its value since President Masoud Pezeshkian took office in August.
Newsweek has reached out to Iran's foreign ministry and the State Department for comment.
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Why It Matters
The rial's collapse reflects mounting pressure from U.S. economic sanctions, geopolitical tensions, and internal economic instability. The sharp depreciation has driven inflation above 40 percent, with food prices soaring by 100 percent in some cases. As the crisis escalates, the economic strain on ordinary Iranians is worsening, with further inflation expected in the coming months.
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What to Know
The decline of Iran's currency is tied to several key factors, including sanctions reinstated under Trump's "maximum pressure" strategy. Since the U.S. withdrew from the JCPOA nuclear deal in 2018, the rial has steadily weakened, dropping from 40,000 per dollar to its current level. On Tuesday, Iran's currency dropped to a record low of 1,050,000 rial to the U.S. dollar according to bon-bast.com, which gathers live data from Iranian exchanges.
Oil Squeeze
The loss of oil revenue, a major driver of Iran's economy, has further contributed to the country's financial crisis. Last week, the U.S. Treasury Department and the State Department announced that it had imposed a new round of sanctions on a network involved in covert Iranian oil exports. This marks the fourth such action since Trump began his second term two months ago.
Iran's oil exports totaled $54 billion in 2024, up slightly from $53 billion in 2023, with volumes averaging 1.5 million bpd, according to the U.S. Energy Information Administration. In February, President Trump signed an executive order directing his administration to reduce Iran's oil "exports to zero."
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Iran's Response
President Pezeshkian had initially pushed for renewed diplomatic talks with Washington. However, Supreme Leader Ayatollah Ali Khamenei dismissed these efforts, calling negotiations as neither "smart, wise, nor honorable." Foreign Minister Abbas Araghchi echoed this sentiment, stating that discussions would remain impossible unless the U.S. changed its "maximum pressure" approach.
The deteriorating situation has led to a rush among everyday Iranians to secure more stable assets like gold and foreign currencies to protect their savings.
What People Are Saying
Afshin Molavi, Senior Fellow, Foreign Policy Institute, Johns Hopkins University School of Advanced International Studies told Newsweek: "Iran needs to get its oil flowing again, unimpeded to international markets. The new sanctions imposed on Iran has made that much more difficult. Any sanctions relief would ease Iran's budget crunch and support its deteriorating economy."
Iran's Foreign Minister Abbas Araghchi stated: "Talks will remain unfeasible unless there is a fundamental shift in U.S. policy."
U.S. Treasury Secretary Scott Bessent said in a post: "Purchases of Iranian oil provide the primary economic lifeline for the Iranian regime, the world's leading state sponsor of terror."
What Happens Next?
With no nuclear negotiations in sight and U.S. sanctions still in place, Iran's currency is expected to continue its downward spiral. Rising inflation and economic hardship will likely fuel further public discontent, while regional tensions keep diplomatic and military risks high.
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