Post by : Rameen Ariff

Iran's parliament has approved a major currency reform plan to remove four zeros from its national currency, the rial, in a bid to simplify transactions and cope with years of runaway inflation. Under the new plan, 10,000 existing rials will be replaced by one new rial, a move that aims to stabilize daily commerce and financial calculations.

The legislation, passed on Sunday, comes two months after a parliamentary commission revived the long-delayed proposal, which had first been floated in 2019 but was later shelved. According to the parliament’s website, both the old and new rial will circulate simultaneously for up to three years, while the central bank will be given two years to implement the transition fully.

The Iranian rial has recently suffered record lows against the US dollar, largely due to renewed international sanctions. Black market data shows that the rial was trading at roughly 1,115,000 to 1 US dollar on Sunday, up from about 920,000 to the dollar when the plan was revived in early August.

The sanctions reimposed by the United Nations followed the “snapback” mechanism triggered by Britain, France, and Germany, signatories of the 2015 Iran nuclear deal, due to Iran’s non-compliance with the agreement.

Before the reform, Iranians often informally drop a zero from the rial for everyday transactions, creating the unit known as the toman, which is widely used in markets and shops across the country. The official redenomination now seeks to formalize this practice and ease financial operations nationwide.

However, the plan still requires approval from Iran’s Guardian Council and the signature of President Masoud Pezeshkian before it officially takes effect. Experts say the move could improve the credibility of Iran’s currency, help reduce accounting errors, and simplify prices for goods and services in both domestic and international trade.

This historic step highlights Iran’s ongoing struggle with inflation and currency depreciation, which has created economic uncertainty for millions of citizens in recent years.

#world news #Global News