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Rouhani says Iran will not give in to pressure from Trump

Protests broke out in Iran on Monday over the sharp fall of the Iranian rial as economic conditions worsen
Iranian President Hassan Rouhani (L) speaking as Iranian Supreme Leader Ali Khamenei listens during a meeting with members of the Iranian government in Tehran (AFP/handout)

President Hassan Rouhani promised Iranians the government would be able to handle the economic pressure of new US sanctions, a day after traders massed outside parliament, protesting against a sharp fall in the value of the national currency.

Washington is to start reimposing economic penalties on Tehran in coming months after US President Donald Trump quit an agreement between major world powers and Iran in which sanctions were lifted in return for curbs on its nuclear programme.

This may cut Iran's hard currency earnings from oil exports, and the prospect is triggering a panicked flight of Iranians' savings from the rial into dollars.

On Monday, police patrolled Tehran’s Grand Bazaar as security forces struggled to restore normality after clashes with protesters angered by the rial's collapse, which is disrupting business by driving up the cost of imports.

Grand Bazaar store owners protest in Tehran as rial's value plummets
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While the dollar has been fetching up to 80,000 rial on the black market since 9 April, the government has announced that it would value the dollar at 42,000 rials to import companies.

However, companies acting in bad faith have been re-selling their cheaply acquired dollars in the domestic market instead of using them for imports. 

"A few companies are getting cheap priced dollars from the government to import people's necessities. But they are betraying people and their country as they are selling their dollars in the black market at a high price," Assad Moradi, an economic analyst, told MEE.

"Unfortunately, the number of companies committing these illegal actions isn't low."

Defending his economic record, Rouhani said the government’s income had not been affected in recent months, and the fall in the rial was the result of "foreign media propaganda".

"Even in the worst case, I promise that the basic needs of Iranians will be provided. We have enough sugar, wheat, and cooking oil. We have enough foreign currency to inject into the market," Rouhani said in a speech broadcast live on state television.

Rouhani said the fresh US sanctions were part of a "psychological, economic and political war", adding that Washington would pay a high price for its actions.

"Withdrawal was the worst decision he (Trump) could make. It was appalling. It hurt America's global reputation," he said.

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