Iran currency extends record fall as U.S. sanctions loom

DUBAI (Reuters) – Iran's currency hit a new record low on Sunday, dropping past 100,000 rials to the U.S. dollar as Iranians brace for Aug. 7 when Washington is due to impose first batch of economic sanctions.

In May, the United States pulled out of a 2015 deal between world powers and Tehran under which international sanctions were lifted in return for curbs on its nuclear program.

Washington decided to impose penalties upon their withdrawal, accusing it of posing a security threat. It has been reported that they must halt imports of Iranian oil from Nov. 4 or face U.S. financial measures.

On Sunday, the rial plunged to 112,000 on the unofficial market, down from about 97,500 rials on Saturday, according to foreign exchange website Bonbast.com. Other websites said the dollar was exchanged between 108,500 and 116,000 rials.

The rial has lost on half of its value because of a weak economy, financial difficulties at local banks and heavy demand for dollars among Iranians who fear the effects of sanctions.

The central bank blamed "enemies" for the fall of the currency and the speeding up of the dead.

"The recent developments in the foreign exchange market are largely due to a conspiracy by the cause of exacerbating economic problems and causing public anxiety," the central bank said in a statement read on state television.

Judiciary spokesman Gholamhossein Mohseni Ejei told state television: "29 people have been arrested for economic disruption and will be soon put on trial …" May be arrested tonight and tomorrow. "

of 'spreading corruption on earth', "Ejei said, referring to a capital offense under Iran's Islamic laws.

Beside the currency fall, the expected return of sanctions has been broken down by the protagonists.

On Saturday, Ejei said 18 people had been arrested over alleged profits and the illegal importation of luxury cars.

U.S. President Donald Trump has agreed to the agreement, Iran's European partners in the deal are preparing a package of economic measures.

But France said this month it was not possible.

On Aug. 7, Washington will reimpose sanctions on Iran's purchase of U.S. dollars, its trade in gold and precious metals, and its dealings with metals, coal and industrial-related software.

Sanctions also will be restored to U.S. imports of Iranian carpets and foodstuffs and certain related financial transactions.

Iran's oil exports could be affected by the sanctions, straining oil markets, and supply sources elsewhere.