Currency markets in Iran surged on March 18 amid ongoing political tensions and recent impeachment proceedings, with the US dollar climbing to IRR 981,500—up 2.67% from the previous day on Ferdowsi Street in Tehran, IntelliNews has learned.

The Iranian rial has faced the dollar's sustained upward trend, which many Iranians see as unstoppable, and has prompted people to convert their assets into foreign currencies or gold to preserve value. In its latest surge, the US dollar approached the IRR 1mn threshold, raising fresh concerns among market observers. Analysts have attributed these higher rates to persistent foreign policy uncertainty, structural economic issues and speculation linked to the removal of former Economy Minister Abdolnaser Hemmati.

The US dollar was quoted at IRR 981,500 on the open market, while the euro advanced 2.80% to IRR 1,073,000 and the British pound sterling rose 2.68% to IRR 1,274,900. The Emirati dirham increased 2.66% to IRR 269,900, and the Turkish lira climbed 2.68% to IRR 26,800.

Prices and trends were different in the regulated market, where the Central Bank of Iran (CBI) has more control. According to Iran’s Centre of Exchange (ICE) website, the dollar fell to IRR 706,630, and the euro moved higher to IRR 771,810.

Local traders on Ferdowsi said political uncertainty and seasonal demand ahead of the Persian New Year Nowruz, coupled with remarks by US President Donald Trump, have contributed to heightened volatility. The market has also been reacting to rumours that tensions in the region could escalate. “The latest upswing in the dollar is due to persisting military strain in the area,” one Tehran-based currency dealer told Intellinews.

Recently, the US Department of the Treasury announced sanctions on 18 companies and 13 ships—along with Iran’s Oil Minister Mohsen Paknejad—on allegations of enabling oil exports to China and maintaining what Washington terms a “shadow fleet.” Officials in Tehran dismissed the measure, insisting the move will have limited impact on oil sales or fiscal policy.

Political concerns also include recent comments by Israeli Prime Minister Benjamin Netanyahu regarding the end of a ceasefire in Gaza, with Trump expressing support for Israel’s actions. Observers say the uncertainty surrounding these developments has heightened risk-averse sentiment among Iranian traders, prompting some to turn to gold or stablecoins as safer options.

Towards the close of the trading day, many analysts noted repeated tests of the dollar’s resistance level above IRR 981,500. They cautioned that if the greenback remains firmly above this threshold, further gains could follow. Nevertheless, some market participants described the turbulence as “excessive,” predicting calmer activity if no major disruptions occur in the weeks to come.

The dismissal of Abdolnaser Hemmati as Economy Minister has drawn attention from moderate politicians and commentators, who suggest the parliamentary proceedings against him were politically motivated. Hemmati was impeached earlier this month because of his monetary policies, which critics claim were responsible for historic surges in exchange rates.

The controversial removal of the former Economy Minister Abdonasser Hemmati has become the centre of comments by moderate politicians and commentators. Parlimentarians impeached him earlier this month due to his monetary policies, which were the leading cause behind the historic jumps in exchange rates.

Kamal Seyed Ali, the former deputy governor for foreign exchange affairs at the Central Bank of Iran, denied claims by some members of Parliament that Abdolnasser Hemmati’s currency policies drove recent fluctuations, stating, “Iran’s economic challenges cannot be resolved by removing one individual from the economic structure.” Seyed Ali further noted that domestic structural constraints and international sanctions also contribute to the volatility.

Amid debates on whether Hemmati’s impeachment would stabilise currency values, some analysts argued the parliamentary proceedings were politically motivated. “They did not want Hemmati in the fourteenth government, and they acted on personal disagreements,” Seyed Ali said.

Critics in the market have suggested the impeachment is unlikely to produce the intended economic impact, as monetary policymaking remains under the direct purview of the CBI.

Bahaodin Hosseini-Hashemi, an economic analyst, stated that ongoing budget deficits and excessive bank borrowing would continue to fuel currency fluctuations.

“We can expect at least a 30 to 40% rise in the exchange rate next year, matching our current inflation,” he told Shargh. He added that foreign tensions “intensify inflationary expectations” and exacerbate exchange-rate instability.