Protests erupt in Iran after rial sinks to record lows; central bank chief resigns

TEHRÁN, Iran — Protests erupted across Iran on Monday after the rial fell to a record low versus the U.S. dollar and the head of the central bank resigned, according to state television and reporting by The Associated Press. In Tehran, demonstrators gathered in areas including Saadi street in the center of the capital and the Shush neighborhood near the Grand Bazaar, where witnesses said police used tear gas in some parts to disperse crowds.

State television reported that Mohammad Reza Farzin, the head of Iran’s central bank, resigned. The official news agency IRNA confirmed that protests were taking place.

Witnesses told AP that merchants closed their shops on Monday and urged other business owners to do the same. The semiofficial ILNA reported that many businesses stopped selling, while some kept their stores open.

The demonstrations broadened beyond Tehran. Witnesses also reported protests in other major cities including Isfahan, Shiraz and Mashhad.

AP reported that the Monday protests were the biggest since 2022, when Mahsa Jina Amini died in police custody. Amini was arrested by Iran’s morality police after being accused of not wearing her hijab properly.

The unrest began the day before. On Sunday, protests were limited to two large bazaars in central Tehran, where demonstrators chanted anti-government slogans.

The currency slide appeared to drive the anger. On Sunday, the rial fell to 1.42 million per U.S. dollar; on Monday, it was trading at 1.38 million rials per dollar. AP also said the currency had been at about 430,000 rials per dollar when Farzin took office in 2022, and it traded at about 32,000 rials per dollar when the 2015 nuclear accord was reached—an agreement that lifted sanctions in exchange for strict controls on Iran’s nuclear program.

AP said the 2015 accord unraveled after President Donald Trump withdrew the United States unilaterally in 2018, and it added that uncertainty has increased after a 12-day war in June against Israel. The report said many Iranians feared the possibility of a wider confrontation involving the United States, which heightened anxiety in the market.

The currency decline is also tightening economic pressure. AP said the depreciation is worsening inflation pressures by raising prices of food and other basic necessities and stressing family budgets. The report said the trend could intensify with a recent change in gasoline prices.

The state statistics center reported that inflation in December rose to 42.2% compared with the same period a year earlier, and that it was 1.8% higher than in November. It reported that food prices rose 72% and that health and medical items increased 50% compared with December of the prior year, and AP said many critics view the figures as a sign of imminent hyperinflation.

The report also said worries intensified after reports that Iran’s government plans to increase taxes in the new Iranian year, which begins March 21. In September, AP said the United Nations reimposed sanctions related to Iran’s nuclear program, freezing Iranian assets abroad, halting arms transactions with Tehran, and imposing sanctions related to Iran’s ballistic missile program.