Iran rial: Mahmoud Ahmadinejad blames slide on 'enemies'

Rahul92

Senior Member
Joined
Sep 4, 2010
Messages
1,622
Likes
751
Iranian President Mahmoud Ahmadinejad has blamed the "enemies" of his country for the sharp falls in its currency, the rial.

The currency has fallen to fresh record lows against the US dollar.

Iranian Industry Minister Mehdi Ghazanfari has blamed speculators for the fall.

But US officials say the slide reflects the success of US economic sanctions targeted at Iran's controversial nuclear programme.

Mr Ahmadinejad said Western sanctions amounted to an economic war, but they would not stop the country's programme.

"We are not people to retreat on the nuclear issue," he told a news conference in Tehran. "If somebody thinks they can pressure Iran, they are certainly wrong and they must correct their behaviour."

The central bank has placed a $5,000 (£3,100) limit on the amount of foreign currency travellers can take in or out of Iran.

The rial has reportedly lost more than 80% of its value since 2011 because of US-led trade sanctions.


Reports from Tehran suggest the rial plunged 18% in Monday's trading and then another 9% on Tuesday.

Since the start of the year, the currency has lost four-fifths of its value, says the BBC's Mark Gregory.
'Security move'

The US-led sanctions are being imposed on Iran because of the country's disputed nuclear programme. The US accuses Iran of aiming to build nuclear weapons, while Iran counters that it simply wishes to develop nuclear power stations.

The sanctions, which are backed by the European Union, include a ban on the purchase of Iranian oil.

The US has also threatened to take action against foreign firms and institutions dealing with the Iranian central bank.

While Iranians are said to be scrambling to convert their rials into hard currency, thereby adding to the downward pressure on the rial, the government has blamed speculation by money changers.

According to the Iranian Fars news agency, Mr Ghazanfari said: "We have greater expectations that the security services will control the branches and sources of disruption in the exchange market.

"Brokers in the market are also pursuing the increase in price, because for them it will be profitable, and there is nobody to control them."

On Tuesday, the rial was said to be trading in Iran at about 37,500 to the dollar, down from about 34,200 late on Monday.

The rial is not traded on the global currency markets, so it is not possible to produce accurate figures for its value.

The weakness of the rial has harmed the wider Iranian economy, as it means the country cannot afford to import as many foreign goods and raw materials which are priced in hard currency.

BBC News - Iran rial: Mahmoud Ahmadinejad blames slide on 'enemies'
 

Rahul92

Senior Member
Joined
Sep 4, 2010
Messages
1,622
Likes
751
But i see the opportunity for India,china,S.Korea to import more for less Especially for India we are continuously hampered by these crude imports
 

sob

Mod
Joined
May 4, 2009
Messages
6,425
Likes
3,797
Country flag
But Rahul92, the international prices for crude are fixed in Dollars, so imports from Iran will not become cheaper. In fact Iranians will get less money for the same Iranian Rial, which goes into producing Crude oil.

Also Iran has been offering discounts to importers to give an incentive to buy from them, in face of the US sanctions.
 

sob

Mod
Joined
May 4, 2009
Messages
6,425
Likes
3,797
Country flag
Meanwhile there have been protests in Iran against the Central Bank for the continued devaluation of the Iranian Rial.

BBC News - Iran police clash with protesters over currency crisis

Riot police in Iran have clashed with protesters in the capital over sharp falls in the currency, the rial.

Tear gas was used to disperse the demonstrators, some of whom were setting fire to tyres and rubbish bins. There were many arrests, reports say.

Eyewitnesses told the BBC that scores of people gathered outside the central bank, calling for the governor to stand down, chanting anti-government slogans.

The rial has plummeted to record lows against the US dollar in recent days.

Amateur video footage posted online appeared to show hundreds of people marching towards Iran's central bank.

Eyewitnesses told BBC Persian that riot police fired tear gas to disperse the crowds.

Reports say many shops in the central Grand Bazaar brought down their shutters in sympathy with the demonstrators.

Traders are angry at the lack of direction from the government in the crisis, which they say has led to more instability in prices and made trading almost impossible, according to commentators.
 

sob

Mod
Joined
May 4, 2009
Messages
6,425
Likes
3,797
Country flag
Analysis of the events from BBC Persian

Kasra Naji, BBC Persian
It is not every day that you see anti-government protests in Iran, let alone by those who have, on the whole, done very well under President Ahmadinejad and the Islamic regime.

What has led them to frustration is the continuing free fall of the value of the Iranian rial - in recent days by 15% per day. This speed of devaluation has made it very difficult for them to buy and sell as prices change on hourly basis.

Worse still, they find President Ahmadinejad, who seems to have little idea about how to arrest the downward spiral of the currency, blaming them for the crisis.

It is clear that Mr Ahmadinejad's many enemies in various centres of power have begun a push to remove him before his term ends in June 2013. He may be the first big casualty of the sanctions against Iran. But Mr Ahmadinejad is a fighter and his removal may not be that easy.
So it seems that there could be a power struggle between President Ahmadinejad and his opponents.
 

sob

Mod
Joined
May 4, 2009
Messages
6,425
Likes
3,797
Country flag
By the looks of it, the Iranian media too seems to be quite critical of the President and his style of functioning.

Iranian media reaction

The conservative daily, Khorasan, asked: "Mr Ahmadinejad, are you the country's president?" It said the president had failed at a news conference on Tuesday to say "what 'programmes' and 'new plans' the government has to resolve the situation".

The reformist newspaper, Etemad, carried an editorial headlined "Why can't you?" saying that "once again Ahmadinejad took no responsibility for the chaotic situation".

The conservative news website, Baztab-e Emruz, pointed to the negative impact of the president's remarks on the decline in the rial's exchange rate. "An hour after Ahmadinejad's news conference... the rate of the dollar, which had reduced to 3,200 tomans [32,000 rials approx] in the afternoon, increased to 3,550 again," it said.

The moderate Mardom Salari noted the "contradictory views" of Majlis Speaker Ali Larijani on the instability of the exchange rate. On Tuesday Mr Larijani told the Fars news agency: "Eighty percent of our economic issues and problems are related to the system of management."

Source: BBC Monitoring
 

W.G.Ewald

Defence Professionals/ DFI member of 2
Professional
Joined
Sep 28, 2011
Messages
14,139
Likes
8,574
Analysis of the events from BBC Persian



So it seems that there could be a power struggle between President Ahmadinejad and his opponents.
I look forward to seeing his pin-sized head on a pike. That little mutant is a walking advertizement for eugenics.:mad:
 

sob

Mod
Joined
May 4, 2009
Messages
6,425
Likes
3,797
Country flag
Bill, a power struggle in Iran could backfire if we get a more hardline President. However I would also like to see the ordinary Iranians assert themselves more and get rid of this regime.

Students have been protesting regularly but they have always been brutally clamped down. The moderates do not seem to be strong enough.

And we cannot discount the support the President derives from the Iranian Revolutionary Guards (Pasdarans).
 

sob

Mod
Joined
May 4, 2009
Messages
6,425
Likes
3,797
Country flag
BBC News - Iran currency plunge bites into border trade with Turkey

The currency collapse in Iran means that Iranian business can't afford to place their normal orders from Turkey. One Turkish customs official says that Turkish trucks stopped coming to the border several days ago.

The same official invites the BBC team to cross briefly through the blue gate into the Iranian section of the free trade zone. This is a small area where Turkish drivers are allowed to drop off their goods for collection by Iranian drivers.

It is not the formal border crossing itself which is a few metres along the road. The atmosphere at the gate is relaxed.

One Turkish man who serves tea inside the zone appears to be allowed to come and go at will in order to use the tap on the Turkish side to wash his cups.

The gate is opened, and the Turkish official accompanies us onto the other side. He asks us not to take any pictures.
 

asianobserve

Senior Member
Joined
May 5, 2011
Messages
10,502
Likes
5,503
Country flag
Iranians Abandon Meat for Bread as Rial Drop Fires Protests - Bloomberg

"xxx

Iran's rial is in a tailspin, having lost more than half of its value against the dollar in street trading in the past two months as U.S. and European sanctions aimed at curbing the country's nuclear program bite. Riot police yesterday fired tear gas and sealed off parts of downtown Tehran after the currency's plunge triggered street protests.

xxx
 

average american

Senior Member
Joined
Aug 28, 2012
Messages
1,540
Likes
438
This is what the future holds for Iran if they continue the production of nuclear weapons, isolation of the scale of North Korea forever.
 

W.G.Ewald

Defence Professionals/ DFI member of 2
Professional
Joined
Sep 28, 2011
Messages
14,139
Likes
8,574
Actually, There Is No Hyperinflation In Iran - Business Insider
Contrary to reports, there is no hyperinflation in Iran right now at all.

In fact, the Western sanctions imposed on Iran's oil trade are failing miserably to meet their objectives.

And a regime collapse – or even, coming short of that, another popular uprising reminiscent of June 2009 – seems further away from Iran than ever.

Meanwhile, the Iranian regime is using the current sanctions imposed against it by the West as a weapon to weaken its own fiercest domestic threat – the educated, relatively pro-Western Iranian constituency that comprises the middle class.

In this way, the economic warfare the West has waged against Iran to weaken the regime is actually amplifying the regime's control.

Before we get to that, though, we need to take a look at why there is no hyperinflation in Iran – because what is being confused as hyperinflation by outside observers and the press right now is actually the mechanism through which Iranian leaders are tightening their grip on Iranian society.
 

Latest Replies

Global Defence

New threads

Articles

Top