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Iran's Currency Continues Downward Trend, Impacted By Nuclear Decision

Large denomination Iranian banknotes show the devaluation of the rial. File photo

The Iranian currency continued its downward trend on Thursday, May 9 after Iran announced its gradual reduction of commitments under the nuclear agreement.

Iran's rial was reported to be trading at 156,500 to the U.S. dollar, down almost 10 percent compared with a week ago. The big drop was on Tuesday as the news about Iran's impending decision was announced.

On May 8, when President Hassan Rouhani delivered a speech officially announcing the nuclear decision, the Iranian currency did not show any big fluctuation, most probably because of central bank intervention. But on May 9, the rial declined 3,500 points.

The euro also rose, trading at 175,100 rials, compared with 170,000 two days ago.

Iran's decision to partially withdraw from the 2015 nuclear agreement is bound to be signal rising tensions with the U.S. and possibly Europe. In addition, Washington imposed new sanctions on Iran's metals and mining sectors, which is a growing export sector for the country.

Fifteen months ago, before the reimposition of U.S. sanctions, the rial was trading at 40,000 to the dollar.