Amid the wave of protests in Iran, much attention has been paid to the devaluation of the national currency on the so-called open market. Since the eruption of unrest in Sept. 2022 following the death of a young woman in the custody of morality police, the rial has lost almost 30% of its value on the open market. This plunge reflects the sentiment in society, including in the business community, towards the sustainability of the country’s economy. 

In the meantime, the more important NIMA rate—used for imports and exports—has been relatively stable. While the greenback fetches just under 440,000 IRR on the open market, the NIMA rate for the US dollar is 285,000 IRR. Of significance, the differential between these two rates—about 54%—is the highest since the NIMA rate was introduced in July 2018. 

Old face assumes new position 

This is not the first time that Iran’s national currency is experiencing a major devaluation. Poor management of the economy and ongoing market interference by the Central Bank of Iran (CBI) and other state institutions have continuously distorted the valuation of the rial. Each time interfering entities have lost control of exchange rates due to domestic and external disruptions, a crisis has been on hand. 

The Ebrahim Raisi administration has reacted to the rial’s plunge on the open market by replacing the CBI governor. On Dec. 29, the government announced that...