Iran faces a severe economic collapse as the Rial hits 1.4 million per US dollar. Soaring inflation, sanctions, war, and public protests over costs and regime unrest are pushing the country toward deep recession and poverty.
Iran is plunging into an abyss of economic collapse beyond imagination. With the country’s official currency, the ‘Rial,’ facing its biggest crash in history, ordinary people are struggling, unable to afford even daily necessities. Currently, one needs 1.4 million Iranian Rials to get one US dollar. In comparison with the Indian Rupee, this means you can get 1.4 million Rials for just about 90 rupees.
War and Sanctions Broke the Backbone
The war that began with Israel last June accelerated Iran’s downfall. US bombings on Iran’s nuclear facilities and renewed UN sanctions over nuclear tests broke the economy’s backbone. The oil marketing restrictions imposed by the Donald Trump administration in 2018 and the reduced availability of foreign currency had already caused a significant impact. As the crisis spiraled out of control, Iran’s Central Bank chief, Mohammad Reza Farzin, resigned last December.
40 Years; A 20,000-Fold Drop
Looking at Iran’s history, this collapse is shocking. During the 1979 revolution, one US dollar could be bought for just 70 Rials. However, at the beginning of 2026, it crossed 1.4 million. This means the currency’s value has plummeted 20,000-fold in the last four decades. In 2025 alone, the Rial’s value dropped by about 45 percent. Fearing their savings will be wiped out, Iranians are rushing to exchange their Rials for dollars and gold.
Surging Public Anger
The protests began in December when merchants at the famous ‘Grand Bazaar’ in the capital, Tehran, shut their shops and took to the streets. The hourly drop in currency value pushed traders into massive debt. This strike, which started on Jomhouri Avenue, was later joined by students and workers. Now, the protest is not just against inflation but has turned into a fight against the Islamic Republic regime led by Supreme Leader Ayatollah Ali Khamenei. The unrest in the country following the death of a young woman named Mahsa Amini in police custody in 2022 has fueled the current protests.
Awaiting Severe Poverty?
Currently, Iran’s inflation rate is 42.2 percent. While salaries remain largely unchanged, soaring prices of goods are crippling ordinary people. According to the World Bank, Iran is facing a major economic recession. It is predicted that Iran’s GDP will shrink by 1.7 percent in 2025 and 2.8 percent in 2026.