Extending previous losses, forex rates plunged further in Tehran on Sunday following new reports on the progress in the Iran nuclear talks in Vienna.
The US dollar was traded at 256,300 rials in the free market after losing the critical 260,000-rials support level in the late trading hours on Saturday.
Along with decline in other major currencies, the greenback lost more than 1.2% or 3,200 rials compared to the session before, putting losses at 3.8% in two days.
Observers link the trend to optimism about the fate of the ongoing negotiations between Iran and the five signatories to the 2015 nuclear deal, also known as Joint Comprehensive Plan of Action (JCPOA).
The negotiators are trying to revive the historic deal, which was abandoned by former US president Donald Trump in 2018. After withdrawal, Trump imposed the toughest sanctions on Iran’s economy, including its financial ties with the world.
All negotiating parties have described the nuclear talks as constructive. However, they have stress that tough political decisions are crucial to overcome the remaining differences.
Data compiled by the Persian-language economic newspaper Donya-e-Eqtesad show the dollar has lost about 15% of its value against the rial in the past two months and after the eighth round of nuclear talks began.
Success of the talks is tantamount to a stronger rial, which has lost much of its value over the past year, as banking and financial sanctions would be lifted and billions in Iranian blocked forex assets released.
Other currencies also incurred big losses on Sunday. The euro dipped close to 1.5% or 4,200 rials and was quoted at 291,690 rials. The UAE dirham lost almost 2.3% to buy 70,200 rials and the UK pound sterling was traded at 352,890 rials, down 0.65% or 2,310 rials on the session before.
Rates also registered decline in exchange bureaus operated by the Central Bank of Iran. The Melli Exchange, affiliated to the state-owned Bank Melli Iran, tagged the greenback at 247,730 rials, down 1.22% on Saturday.
In the regulated market, where currency is traded wholesale, the greenback was tagged at 241,780 rials, down 1.7%. The market is a CBI-affiliated spot market operated by a network of banks and certified moneychangers dealing in wholesale currency.
Prices in the domestic bullion market dropped in tandem with the declining currency rates. The popular Emami gold coin lost close to 0.6% to change hands at 117.75 million rials.
Half Bahar Azadi coin was down 0.3% to reach 66 million rials and one gram of 18-karat gold was worth 11.76 million rials, 1.8% lower compared to the session before.
