4 Oct 2012

Protests in Iran against fall in currency

6:37 am on 4 October 2012

Riot police in Tehran broke up protests on Wednesday after sharp falls in Iran's currency which has plummeted against the US dollar.

The rial is at record lows after losing 40% of its value against the US dollar in a week, due to economic sanctions imposed over its nuclear programme.

Scores of people gathered outside the central bank, calling for the governor to stand down and chanting anti-government slogans.

Money dealers were joined by traders from the Grand Bazaar nearby, where the shutters of many shops were closed in sympathy with the demonstrators.

The BBC reports traders are angry at a lack of direction from the government in the crisis.

Police are also reported to have arrested illegal money changers in the capital.

Tehran's bazaar is traditionally the biggest financial ally of the regime. The bazaar is said to have bankrolled the 1979 Islamic revolution.

The political core of the bazaar is Motalefeh, a political group loyal to Supreme Leader Ayatollah Ali Khamenei.

President President Ahmadinejad Ahmadinejad has blamed Western sanctions for the fall in the rial, saying they amounted to an economic war. However, many Iranians accuse him of financial mismanagement.

US officials say the slide reflects the success of the sanctions.

AFP reports the plunge in the rial has greatly increased inflation in Iran, which is widely seen as far higher than the official 23.5% given by the central bank.