Overview
- Open-market exchange rates hovered around 1.4–1.5 million rials per US dollar this week, underscoring a deep gap with the far-stronger official rate.
- Demonstrations that began with Tehran bazaar strikes on Dec. 28 have expanded nationwide, with rights group HRANA citing large death and arrest figures that remain unverified in the absence of official totals.
- President Masoud Pezeshkian acknowledged economic shortcomings, while the government kept short-term subsidies in place and replaced central bank governor Mohammad-Reza Farzin with Abdolnasser Hemmati.
- Inflation is projected to stay above 40% into 2026, food prices have run far hotter, and international forecasts point to near-stagnant growth and a budget deficit near 6% of GDP.
- Sanctions and constrained oil sales have cut foreign-currency inflows, with a Reuters survey indicating a late-2025 output drop of about 100,000 barrels per day and IMF data pointing to weaker exports.
- Analysts and opinion writers floated sweeping fixes, including tax overhauls and currency stabilization plans, though these proposals are commentary rather than government policy.