Iranian rial hits record low as sanctions escalate

The Iranian rial has plunged to a record around 2.02 million per U.S. dollar on informal markets, well above the official rate near 1.5 million, as sanctions and war pressures deepen Iran’s economic crisis. The free-falling currency comes amid soaring inflation and a projected GDP contraction of more than 5 percent, with food prices rising sharply and ordinary Iranians feeling worsening shortages. The United States unveiled a sweeping new sanctions package described by Treasury Secretary Scott Bessent as the greatest financial offensive against an adversary, targeting Iran’s trading partners and increasing economic isolation. Tehran has pushed back, promising countermeasures and warning of consequences for nations cooperating with Washington, while officials also cite past sanctions as evidence they can endure and adapt. The UAE suspended trade with Iran, underscoring the disruption to regional commerce as secondary sanctions and pressure expand, and Iran signals readiness to respond diplomatically through existing channels such as the memorandum of understanding with the U.S. that remains a pathway to negotiations. Analysts and Iranian officials alike describe the broader strategic objective as coercive economic pressure aimed at forcing Tehran back to the negotiating table, with the dollar’s free fall highlighting the vulnerability of the regime’s economic lifelines.