Iran hit by biggest protests since 2022 as currency crashes, central bank chief resigns

Demonstrations spread nationwide after the rial hit record lows and inflation surged, echoing unrest last seen after Mahsa Amini’s death.

Iran was rocked on Monday by its largest protests in three years after the rial plunged to a record low against the US dollar and the head of the central bank resigned, escalating pressure on the government amid a deepening economic crisis, CNN reported.

State television confirmed the resignation of Mohammad Reza Farzin, as traders and shopkeepers rallied in central Tehran, including Saadi Street and the Shush area near the Grand Bazaar, a traditional political flashpoint in Iran’s modern history.

The protests quickly spread beyond the capital. Demonstrations were reported in Isfahan, Shiraz and Mashhad, according to witnesses cited by CNN and Iran’s official IRNA news agency. In parts of Tehran, police fired tear gas to disperse crowds.

Currency shock triggers unrest

Iran’s currency fell to 1.42 million rials per dollar on Sunday, before slightly recovering to 1.38 million on Monday. When Farzin took office in 2022, the rial traded at about 430,000 to the dollar, underscoring the scale of the collapse.

Traders told CNN that many shopkeepers shut their businesses and urged others to do the same. The semi-official ILNA news agency reported widespread stoppages, even as some shops remained open.

Protests had begun a day earlier at two major mobile markets in downtown Tehran, where demonstrators chanted anti-government slogans.

Inflation bites households

The currency crash has intensified inflationary pressure across the economy. According to Iran’s state statistics center, annual inflation rose to 42.2% in December, up from November, with food prices jumping 72% year-on-year and health and medical costs rising 50%.

Economists and critics have warned that such trends point toward hyperinflation, especially after a recent gasoline price change pushed up transport and daily living costs.

Further anxiety has been fuelled by reports in Iranian state media that the government plans to raise taxes in the new Iranian year starting March 21.

Echoes of 2022 unrest

Monday’s demonstrations were the biggest since 2022, when the death of Mahsa Jina Amini, a 22-year-old woman who died in police custody after being detained by Iran’s morality police, sparked months of nationwide protests.

While the triggers differ, analysts note a common thread: economic stress acting as a catalyst for broader political discontent.

Sanctions and geopolitical strain

Iran’s economic slide has been compounded by external pressure. The rial traded at around 32,000 per dollar in 2015, when a nuclear deal lifted international sanctions. That agreement collapsed after Donald Trump withdrew the US in 2018.

In September, the United Nations reimposed nuclear-related sanctions through the “snapback” mechanism, freezing Iranian assets abroad, halting arms transactions and reinstating penalties linked to Iran’s missile programme.

Market anxiety has also been heightened by fears of renewed conflict following June’s 12-day war involving Iran and Israel, with concerns that a broader confrontation could draw in the United States.