Escalating geopolitical tensions, ongoing U.S. economic sanctions, and President Trump’s recent declaration of an economic “D-Day” against Iran continue to hammer the Iranian economy without mercy. This morning, the free market hit another record low as the local currency crossed the 2,000,000 rial per dollar threshold.
At the start of the year, the exchange rate stood at 1,350,000 rials to the dollar. Since then—and especially since the outbreak of Operation Roaring Lion—the price has climbed relentlessly, crossing today’s psychological barrier of 2 million rials per dollar, a jump of over 45% since the beginning of the year. Since the start of 2024, the currency has fallen 300%.
Citizens Pay the Price
For ordinary Iranians, crossing the 2,000,000 threshold isn’t just a statistical figure—it’s a devastating blow to their purchasing power. The immediate impact of the currency collapse is a sharp spike of over 80% inflation in two years, dramatic price increases for basic food items, medicine, and electronics, and the effective transformation of the rial into a worthless piece of paper.
In typical Iranian fashion, authorities are trying to obscure the staggering devaluation. The Central Bank in Tehran continues to display an official, frozen, and disconnected exchange rate of around 1.37 million rials to the dollar. The actual figure of 2 million rials per dollar refers to the free market rate—the black market where real life in the country is conducted.