Iranian Parliament Approves Plan to Drop Four Zeros from National Currency

Reuters

U.S one dollar bill & Iranian rials displayed as the value of Iranian Rial drops, 8 February 2025.

Iran’s parliament has approved a long-discussed plan to redenominate the rial by removing four zeros from its value, in a move aimed at simplifying transactions after years of high inflation.

Years of inflation averaging above 35% have caused the rial to plunge to about 1,150,000 to the U.S. dollar on the free market, according to currency tracker bonbast.com. The collapse has made everyday transactions and financial statements difficult for citizens to navigate.

State media reported on Sunday that parliament had passed the bill after resolving objections raised by the Guardian Council. “The currency remains the rial and changes won’t be overnight,” said Shamsoldin Hossein, head of parliament’s economic commission.

He explained that the central bank will have up to two years to prepare for the transition, which will then be phased in over three years during which both denominations will circulate.

Hossein argued the change will make the rial easier to use in daily transactions, but some lawmakers voiced scepticism. MP Hossein Samsami told the Iranian Students News Agency: “A national currency’s prestige isn’t revived by removing four zeros. That can only be achieved by strengthening the real value of the currency.”

Several countries have resorted to similar measures amid runaway inflation. Venezuela, for example, has redenominated its currency multiple times in recent years but continues to face severe inflationary pressures.



PUKMEDIA