Iran Replaces Central Bank Chief As Currency Sinks Further

Mohammad Reza Farzin is Iran's new central bank chief. (file photo)

Iran replaced the head of its central bank on December 29 as the country's currency, the rial, continued a sharp decline amid economic troubles aggravated by a lack of progress on nuclear negotiations with the West and months of civil unrest that continues to rock the country.

The government appointed Mohammad Reza Farzin as the new head of the central bank during a cabinet meeting, Iranian state TV reported.

It said the resignation of the current head of the central bank, Ali Salehabadi, was accepted before the appointment of Farzin, who has served as CEO of Bank Melli Iran since last year.

Iran's president stressed the importance of controlling the value of foreign currencies during the cabinet meeting, IRNA said.

The Iranian currency reached a new all-time low against the U.S. dollar on December 28, with one U.S. dollar worth 440,000 rials, compared to 360,000 rials one month ago, according to the foreign-exchange site Bonbast.com.

Iranians have been scrambling to convert their savings into foreign currencies, especially U.S. dollars and euros, amid a worsening economic situation prompted by international nuclear sanctions and political instability triggered by the current wave of protests sparked by 22-year-old Mahsa Amini's death after her arrest by the morality police in September for "improperly" wearing a mandatory head scarf.

Before the beginning of the current wave of protests, the rial was valued at approximately 298,200 to the U.S. dollar.

The weakening of the currency has also been accelerated by dwindling hopes for the revival of a landmark 2015 nuclear deal between Tehran and global powers that had scrapped most international economic sanctions in exchange for limits to Tehran's nuclear program.

Former U.S. President Donald Trump withdrew from the agreement, known as the JCPOA, in 2018, reimposing harsh sanctions on Iran and prompting Tehran to resume nuclear activities.

Negotiations to revive the deal were resumed in April but have since lagged amid Western accusations that Iran was continuing its nuclear enrichment activities.

On December 28, Iranian Foreign Minister Hossein Amir-Abdollahian met in Muscat with the Omani Sultan Haitham bin Tariq, amid speculation that Muscat has taken a role in restoring the deal.

However, German Foreign Ministry spokesman Christofer Burger stated on December 28 that Berlin, one of the signatories of the agreement, sees no reason to return to the negotiations.

Tehran insists its nuclear program has only civilian purposes, but the West fears it could be moving closer to being able to build a nuclear weapon.

Written by Ardeshir Tayebi based on an original story in Persian by RFE/RL's Radio Farda;
with additional reporting by Reuters and AFP