During the past three days, the Iranian currency fell against foreign currencies by 18 percent, representing a sign of an accelerated crash of the Iranian economy which started the moment the US announced it was withdrawing from the nuclear deal and reinstating sanctions against Iran.
With the beginning of August, the new sanctions on Iran came into effect and the Iranian economy is currently witnessing an early severe crisis, making it difficult to predict when it would end or when it would peak.
Jahanbakhsh Mohebinia, who sits on the Majlis Budget and Planning Committee on the Iranian Parliament stressed that: “The Iranian economy in collapsing,” urging officials in his country to “examine the price of the dollar, which amounted to 110,000 riyals,” while the price of the US currency at the beginning of the year did not exceed 37,000 riyals, describing the situation as “shameful to those who claim to have the best interest of people”.
The hunger revolution is coming
The semi-official Iranian Labour News Agency (ILNA) reported on Hussein Raghefer, an Iranian economic expert and former adviser to the ministries of welfare and science, on his warnings about the “collapse of livelihood” and “the revolution of the hungry” in Iran.
Raghefer continued saying that “what we are witnessing today is a crash in the life of society,” adding that if the situation doesn’t change it would lead to “an inevitable revolution led by the hungry”.
According to the latest reports, the dollar approached 120,000 riyals on Tuesday which caused the recession of the foreign exchange market due to fear of price fluctuations from time to time, where during the past three days, the Iranian currency lost 18 percent of its value.
Iranian economy in trouble
In response to the question “to what extent can the dollar price rise?”, ILNA reported on Economic expert Hadid Shakaki as saying: “I think the Iranian economy cannot afford that the price of dollar exceed the 100,000 riyals, because in such case the commodity market will shut down as a result of the stumbling of the purchasing power in keeping up with the price of 100 thousand riyals per one dollar”.
It’s worth mentioning that the average salary in the labor market in Iran is about 25 million riyals. When the price of the dollar was about 35 thousand riyals, the purchasing power for this salary reached about 600 dollars. Today after the fall of the riyal, the purchasing power is less than 250 dollars because the average salary has not changed, this confirms the imbalance between the price of the dollar, which is the currency used to import goods and the personal income in Iran.
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