It began on October 1. The Iranian currency, the rial took a big fall against the US dollar to record lows. The Iranian currency website blacked out the rate. The government closed down the licensed exchange shops. The rial plummeted to 35,000 to the dollar beginning of last week, losing about 80% of its value since late 2011. The daily fall was about 15 %. It understandably provoked a storm of protest which began in a non-violent manner but soon turned violent. Parts of the city were on fire. Demands have been strident for the resignation of the governor of the Central Bank of Iran (CBI). The Mahmood Ahmedlinejad regime is under attack for the chaos in the country’s economy. Those agitating are conservative traders from downtown Tehran and it is these people who have been financing the revolutionary regime. One may scent danger in the air for the government. Traders cannot operate. Shops are drowning their shutters. Prices are climbing.
While the government is facing flak, sanctions imposed by the US and the EU are also cutting into Iran’s economic health. If the CBI had enough petro dollars, it could have cushioned the fall in the value of the currency. The western embargo has reduced Iran’s oil exports to a half. The ruling government has to address the nuclear controversy if it wants a bail-out The Arab Spring has turned into an autumn of discontent. Israel is spouting venom. Iran has bungled in its policy on strife-torn Syria. The solution of Iran’s economic crisis seems out of the present government’s hands.