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The Iranian currency is collapsing to its lowest level in two years


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2020/06/19 01:38:11

Shafaq News / The Iranian riyal has recorded   its lowest level against the dollar since September 2018 in the informal market, as reported by a foreign exchange website, amid worsening economic repercussions for US sanctions and the emerging Corona virus.

The price offered to the dollar amounted to 188,200 riyals, according to the Bonapast.com website, which tracks the informal market, and the official price on the central bank's website is 42 thousand riyals.

U.S. President  Donald Trump  withdrew from an international agreement aimed at curbing Iran's nuclear program in May 2018 and reimposed sanctions that were afflicting its economy.

 
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 Arab and international


Economy News _ Baghdad

The Iranian riyal hit its lowest level against the dollar since September 2018 in the informal market, according to a website of foreign exchange rates, amid worsening economic repercussions for US sanctions and the outbreak of the Corona virus.

The price offered to the dollar amounted to 188,200 riyals, according to the Bonapast.com website, which tracks the informal market, and the official price on the central bank's website is 42 thousand riyals.

U.S. President Donald Trump withdrew from an international agreement aimed at curbing Iran's nuclear program in May 2018 and reimposed sanctions that were afflicting its economy.

 
 
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The Iranian currency fell from the level of 32 thousand riyals
The Iranian currency fell from the level of 32 thousand riyals

Agencies - Abu Dhabi

The Iranian currency fell to an all-time low of 190,000 riyals per dollar, amid severe US sanctions on the country.

The Iranian currency fell from the level of 32 thousand riyals against one dollar at the time of the nuclear agreement between Tehran and world powers in 2015.

The riyal rose unexpectedly after President Donald Trump's decision to withdraw the United States from the nuclear deal and reimpose trade sanctions that have been in place for more than two years.

US sanctions have cut Iran 's oil exports , the country's main source of income, sharply.

Last week, First Vice President Ishaq Jahangiri said that Iranian oil revenue fell to $ 8 billion from $ 100 billion in 2011.

Iran recently sent five tankers with gasoline and similar products worth at least $ 45.5 million to Venezuela.

This was a way to bring money into a hard currency shortage and put special pressure on the United States, which, under the Trump administration, had cracked down on harsh campaigns against both countries.

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 20/26/2020 15:23:24

Shafak News / The Iranian riyal scored on Saturday its lowest level ever against the dollar in the informal market, a day after Tehran was reprimanded by the United Nations' International Atomic Energy Agency, which increased pressure from US sanctions and the spread of the Corona virus.

The price offered to the dollar was 193,300 riyals, compared to 188,200 riyals, on Friday, according to Bonbast.com, which tracks the informal market. Dunia Al-Iqtisad daily newspaper reported that the price of the dollar amounted to 190,800 riyals.

On Friday, the International Atomic Energy Agency (IAEA) Board of Governors called on Iran to stop preventing IAEA inspectors from entering two old nuclear sites, which added to diplomatic pressure on Tehran.

U.S. President Donald Trump withdrew from an international agreement aimed at curbing Iran's nuclear program in May 2018 and reimposed sanctions that ravaged its economy.

The economic crisis in Iran has been deepened by lower oil prices and a slowing global economy.

Abdel Nasser Hemti, the governor of the Central Bank of Iran, said that the psychological impact of the IAEA decision on the riyal is exaggerated and that the Iranian economy can adapt to the additional pressures.

"The conditions caused by the Corona virus (virus), the temporary pressure on the foreign exchange market ... and the psychological atmosphere resulting from the decision of the IAEA Board of Governors should not give the wrong signal," he added in an Instagram post.

He continued, "Despite the limited oil revenues, the country's foreign exchange balance is good, and the central bank will continue to provide the required currency ... despite the ongoing American pressure."

The riyal lost about 70 percent of its value over several months until it reached 190,000 against the dollar in September 2018 amid heavy demand for the dollar among Iranians who feared that Iran's oil exports would shrink and that its economy would be severely affected by Washington's withdrawal from the nuclear deal and the reimposition of sanctions.

 
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The Iranian riyal hit an all-time low against the dollar on the informal market, confirming the severity of the violent crisis facing Tehran's economy, one day after Iran was reprimanded by the United Nations International Atomic Energy Agency, which increased pressure from US sanctions Corona virus outbreak.

The price offered to the dollar amounted to about 193,300 riyals, compared to about 188,200 riyals in Friday's transactions, according to the site “Ponpast.” Com, which tracks the informal market, and the daily "Dunya Al-Iqtisad" newspaper reported that the price of the dollar amounted to 190,800 riyals.

The IAEA’s 35-nation Board of Governors has called on Iran to stop preventing IAEA inspectors from entering two old nuclear sites, which has increased diplomatic pressure on Tehran.

US President Donald Trump withdrew from an international agreement aimed at curbing Iran's nuclear program in May of 2018, and reimposed sanctions that ravaged its economy. The country's economic crisis has been deepened by lower oil prices and a slowing global economy.

The Iranian Central Bank recognizes the crisis

"The psychological impact of the International Atomic Energy Agency's decision in the riyal is exaggerated, and the Iranian economy can adapt to the additional pressures," said the governor of the Central Bank of Iran, Abdel Nasser Hamti, in a statement.

He explained, "The conditions caused by the Corona virus, the temporary pressure on the foreign exchange market, and the psychological atmosphere resulting from the decision of the IAEA Board of Governors should not give the wrong signal."

He added, "Despite the limited oil revenues, the country's foreign exchange balance is good, and the (Central) will continue to provide the required currency, despite the ongoing American pressure."

The Iranian riyal lost about 70 percent of its value over several months, as it reached the level of 190 thousand against the dollar in September of the year 2018, amid heavy demand for the dollar among Iranians who feared that Iran's oil exports would shrink and its economy would be severely affected. Because of Washington's withdrawal from the nuclear deal, and the reimposition of US sanctions.

Discounts to attract airlines

In a related context, and in the context of the current economic crisis, the Iranian Islamic Republic News Agency quoted a senior aviation official as saying that the government "is preparing plans to offer discounts to some foreign airlines that use its airspace", after the decline in traffic due to the Corona virus and tension Regional.

"The discounts will go to the eight largest companies that offer traffic fees and companies that increase their flights by 20 percent," said Nasser Aghai, director of the state-run Airports and Air Navigation Company. However, the agency stated that the authorities are "not planning a general reduction in fees."

Iran is one of several countries that impose so-called "overflights", and its revenue is usually used to fund services, including air traffic control and weather data. "The planned discounts will need government approval," Aghai said, according to Reuters.

The main airlines were changing their routes, or canceling their flights last January, to avoid airspace over Iraq and Iran after an Iranian missile attack on American forces in Iraq. About 176 people were killed, all on board a Ukrainian plane that crashed shortly after taking off from Tehran on a trip to Kiev on January 8. Iran admitted that it had shot down the plane in error, hours after it launched missiles at American targets in Iraq, in response to the killing of Iranian military general Qassem Soleimani in an American strike.

The lowest oil production in 40 years

In terms of oil exports, official data indicate that Iranian oil production recorded its lowest level in nearly 40 years during last May transactions, with the continued restrictions imposed on Tehran, due to US sanctions on the sectors of production and export of crude, and other upcoming sanctions.

The decline in Iran's oil production below the level of two million barrels, to the decline in demand for crude in local markets, as a result of economic and industrial consequences of the spread of the Corona virus in the country, which has failed to date to control the epidemic.

According to the data of the Organization of Petroleum Exporting Countries (OPEC), Iran's oil production last May amounted to 1.97 million barrels per day, compared with 2.1 million barrels per day at the end of 2019. The decline in domestic demand for crude oil in Iran caused the accumulation of stocks in ports and storage tanks This leads to Tehran having to implement a reduction in production in line with actual consumption.

In 2018, the average daily production of crude oil by Iran was about 3.553 million barrels per day, while the average daily production in 2019 was about 2.356 million barrels per day. As a result of the decline in crude oil production and exports, Iran entered into an acute crisis of abundant liquidity, especially foreign exchange, which prompted the government and the central bank to impose strict restrictions on the movement of foreign exchange in the country.

Independent Arabic

 
 
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