Iran's currency fell to an unprecedented low against the dollar on Monday, as the prospect of tougher U.S. sanctions added to the economic strain facing Tehran after years of restrictions and months of war, according to The Associated Press.
The prospect of tougher U.S. sanctions cast a shadow over Iran's currency market on Monday, with the rial sliding to about 2.02 million to the dollar in early trading on the country's informal exchange market.
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The official exchange rate set by Iran's Central Bank was around 1.5 million rials per dollar, but the informal market rate is more widely used by ordinary Iranians and businesses.
The latest decline underscores the deepening economic strain facing Iran.
The currency was already under pressure before the United States and Israel launched attacks on Iran on February 28, with the economy grappling with double-digit inflation and negative growth.
Nearly six months of war have further damaged economic activity, disrupting trade and intensifying pressure on households and businesses.
The prospect of tougher US sanctions has added to uncertainty over the country's economic outlook.
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Washington is expected to announce additional measures aimed at tightening the economic squeeze on Tehran.
The sanctions come as the United States seeks to force Iran into making concessions, but President Donald Trump has so far failed to secure a breakthrough.
However, at the same time, Iran continues to exert significant control over shipping through the Strait of Hormuz, a critical global oil transit route. Before the war, about one-fifth of the world's traded oil passed through the strategic waterway.
Iranian attacks and threats during the conflict have severely disrupted maritime traffic, raising concerns over energy supplies and adding another layer of pressure to global oil markets.
The latest fall in the rial reflects the growing challenges facing Iran as it confronts the combined impact of war, sanctions, inflation and disruption to trade.
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