Iran’s parliament approves plan to cut four zeros from currency

• Iran’s parliament approves plan to remove four zeros from the rial amid steep depreciation.
• Under the plan, 10,000 old rials will equal one new rial; both currencies will circulate for up to three years.

Iran’s parliament on Sunday approved a plan to remove four zeros from the national currency, the rial, as the country faces sharp depreciation amid renewed international sanctions.

The bill, revived two months ago by a parliamentary commission after years of delays, aims to simplify transactions.

Under the plan, 10,000 current rials will be replaced by one new rial. 

Both old and new rials will circulate for up to three years, with the central bank given two years to implement the transition.

The rial has repeatedly hit record lows recently, trading around 1,115,000 to the US dollar on Sunday, compared with roughly 920,000 in early August when the plan was revived. 

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The currency’s decline follows the reimposition of UN sanctions after Britain, France, and Germany invoked the “snapback” mechanism over Iran’s non-compliance with the 2015 nuclear deal.

The redenomination proposal was first introduced in 2019 but later shelved. 

It still requires approval by the Guardian Council and the signature of President Masoud Pezeshkian to take effect. 

In daily life, Iranians often use the toman, which removes one zero from the rial, for most transactions.