The story: Former central bank chief Abdolnaser Hemmati has shocked hardliners with a strong showing in Iran’s economy-focused first presidential debate. Hemmati’s popularity appears to be increasing in the polls, while favored hardliner candidate Ebrahim Raisi’s poor performance has seemingly paved the way for internal divisions among conservatives. As a result, other conservative candidates may not—as previously expected—drop out in favor of Iran's chief justice.

The debate: In the first presidential debate, aired on state TV on June 5, five conservative candidates exchanged blows with one Reformist and one independent hopeful...