The Iranian currency hit an all-time low of 719,500 rials to the US dollar on Wednesday, marking the fourth record drop since September, when Tehran began losing influence in the region to Israel and other players.
Compared to the same date last year, when the dollar was valued at 504,000 rials, the current rate represents a staggering 43% rise.
The rial began trading at 716,000 to the dollar on Wednesday morning but surged to nearly 720,000 rials by noon. Tether, which is an equivalent of US dollar in crypto markets, was being traded at 726,000 rials on the same day.
One notable shock to the currency market came on November 6, when the dollar initially jumped past 700,000 rials following the news of Donald Trump’s victory in the US presidential elections. But the currency began it decline in September after serious blows by Israel against Iran's main regional proxy, Hezbollah and an Israeli air strike that destroyed most of Iran's air defenses.
However, authorities temporarily stabilized the rate below that threshold, most likely by selling foreign currencies to support the rial. The downward trend resumed later that month after the International Atomic Energy Agency’s (IAEA) Board of Governors issued a resolution critical of Tehran for its nuclear program which has breached international regulations, producing 60% enriched uranium as Iran edges ever closer to nuclear weapons capability.
The rial has faced significant volatility throughout the year, influenced by volatility in the region and direct conflict between Iran and Israel.
Iran’s reliance on oil and gas exports for foreign currency earnings has made the country particularly vulnerable to international sanctions. Under Joe Biden’s presidency, sanctions enforcement eased somewhat, offering Tehran a lifeline. But the return of Donald Trump to the White House, combined with Europe’s increasingly tough stance to crack down on Iran's nuclear program, foreshadows greater economic strain for the Islamic Republic.
Inflation in Iran already exceeds 40%, and the rial’s devaluation will exacerbate price hikes, further eroding the purchasing power of ordinary Iranians.
Tens of millions have faced declining living standards over the past five years, with wages lagging behind inflation and around one third of the population now living below the poverty line.
The average worker now earns the equivalent of less than $200 per month, while official data suggests that $500 is the bare minimum required to meet basic needs.
As the dollar’s rise continues, the impact on daily life for Iranians grows more severe. Essential goods and services, already out of reach for many, are likely to see further price increases, deepening economic hardship and fueling public discontent.
At the United Nations Convention to Combat Desertification (COP16) in Riyadh, Iran’s Minister of Agriculture, Gholamreza Nouri, outlined progress made during bilateral talks.
"We laid the groundwork for developing infrastructure in natural resources, the environment, and agriculture between Iran and Saudi Arabia," Nouri said.
His remarks mark a significant development in the rapprochement fostered by the 2023 China-brokered agreement between the two nations.
Saudi Arabia cut diplomatic ties with Iran in 2016 after its embassy in Tehran was stormed during a dispute over Riyadh's execution of a Shiite Muslim cleric.
Tensions escalated further with subsequent conflicts, including missile and drone attacks on Saudi oil facilities and tankers in the Persian Gulf, attributed to Iran-backed Houthi forces, amidst a nearly decade-long war.
Saudi-Iranian relations have improved following the Beijing Agreement, with both countries exploring areas of mutual interest. Yet, trade between the two remains limited. Iranian officials have expressed an ambition to boost bilateral trade to $1 billion annually, a stark contrast to the negligible trade volumes recorded in recent years.
Flights resume amid warming relations
In a further sign of thawing ties, Iran Air resumed flights between Mashhad and Dammam after a nine-year hiatus.
"A deputy from Iran’s embassy, the representative of Iran Air, and representatives from Saudi Arabia’s General Authority of Civil Aviation welcomed arriving passengers in Dammam and stressed the need to facilitate the movement of people between the two countries," ISNA said.
While economic and environmental collaboration are key goals, the rekindling of relations is also part of a broader geopolitical calculus, Saudi and its Persian Gulf neighbor, the United Arab Emirates, working on backdoor diplomacy to reduce the military actions of Iran in the region and curtail its allies across the area.
Last week, Bloomberg reported that Crown Prince Mohammad bin Salman, the de facto Saudi ruler, made an offer of increased trade to Iranian officials in recent weeks in the hope of ratcheting down tension with the West.
Despite progress, challenges remain since the rekindled ties between the two countries, including the ongoing Yemeni Houthis' blockade of the Red Sea region since the war in Gaza.
David Ottaway from the Wilson Centre wrote in March that at an emergency summit of the 57-member Organization of Islamic Cooperation and Arab League held in Riyadh on November 12 last year, Saudi Arabia managed to quash Iranian efforts to mobilize military support for Hamas in its war with Israel.
The meeting also managed to stall pressure on the six Arab states that now have diplomatic ties with the Jewish state—Egypt, Jordan, the United Arab Emirates, Bahrain, Sudan, and Morocco—to cut them. After the Gaza war, talks to normalize relations between Saudi and Israel which progressed into the public domain, have also been stalled, a move which will please Tehran.
Iran's former President Ebrahim Raisi and bin Salman (MBS) met during the summit to discuss various possible areas for cooperation, including Saudi investment in Iran’s sanctions-hobbled economy.
It was here that bin Salman allegedly warned Raisi that Iran "would have to rein in the activities of its regional Arab allies and proxies as the quid pro quo for any Saudi financial or economic aid", Ottaway said.
The hardline Islamist-led forces are unlikely beneficiaries of fallout from neighboring conflicts in which key Syrian allies Iran and Russia are sapped and distracted while uneasy neighbor Turkey presses its advantage.
Syrian president Bashar al-Assad, accused of war crimes by many Syrians and rights groups, fended off an armed challenge to his rule following Arab Spring democracy protests in 2011 with help from Iran-backed Hezbollah fighters and Russian air power.
But much has changed. The war in Ukraine has preoccupied Russia, Hezbollah limped to a ceasefire with Israel and Iran finds itself on the backfoot in a multifront confrontation with Israel in which it has lost the initiative.
“Over the last year, Hezbollah's forces inside Syria got weaker,” said Ibrahim Al-Assil, a Syrian analyst at the Middle East Institute in Washington, D.C.
Al-Assil said he was detained by the Syrian secret police in 2011 while taking part in a peaceful protest against Assad in Damascus. He said he was interrogated and tortured for four days at a Syrian military Airport.
“Now even Russia is overwhelmed and busy with the war in Ukraine,” said Al-Assil who founded the Syrian Nonviolence Movement but now predicts deadly upheaval. “The battle is not going to be easy. It's going to be bloody. It's going to be brutal."
The Israeli military has launched dozens of strikes on alleged Iran weapons facilities, smuggling routes and warehouses, curbing the ability of Iran and its allies to help.
The Israeli military announced on Tuesday in a new release that their Air Force conducted a strike in Damascus targeting Hezbollah’s representative to the Syrian military, Salman Nemer Jamaa.
Israel said Jamaa was a Hezbollah operative who was a key figure in enabling weapons smuggling to Lebanon from Syria, in a sign the Jewish state would still pound its Lebanese adversary despite the calm next door.
How far can Iran go to support Assad?
Whether Iran in its cash-strapped and weakened state can afford to come to Assad's rescue remains a key question.
“Is Syria the hill the Iranian regime is willing to die on? I don't think so,” said Hazem Alghabra, who grew up mostly in Syria was a former advisor to the US State Department on Near Eastern Affairs.
The Iranian establishment may understand its weakened position, and Hezbollah forces could be demoralized and underequipped after a punishing 14-month wrestle with the Mideast's top military power.
“The Iranian regime is not going to make big decisions while they're being chased literally by Israel and the United States. The Iranian regime moves when there's an opportunity, a weakness," Alghabra said. "They operate a bit like a virus, whenever they see a weakened immune system, they move in it."
Who are the rebel forces?
Two of the main rebel forces, Hayat Tahrir al-Sham (HTS) and the Syrian National Army (SNA), are both backed by Ankara.
HTS, known as the Organization for the Liberation of the Levant, is a former Al Qaeda affiliate that pledges to build a state based on Islamic principles.
They are made up Islamist insurgents with Jihadi ideology and former Free Syrian Army factions. They managed to take control of key places in Syria such defense factories in Aleppo, a thermal power station and an air base, according to monitors and eyewitnesses.
All met with little resistance, Greg Brew, an Iran analyst with the Eurasia Group told Iran International.
“Assad's forces have essentially melted away,” said Brew. “Turkey is largely in the driver's seat when it comes to extracting real concessions and real advantage from the situation."
Ankara, while supporting anti-government rebels, may not want Assad to fall, however.
Turkish President Recep Tayyip Erdogan may be using the Islamist insurgents to push a reluctant Assad to acquiesce to a Turkish sphere of influence in Northern Syria, allowing the millions of Syrian refugees in Turkey to return.
Weakened Syrian control over the area may aid Turkey's goal of undermining Kurdish foes further to the East who could also soon find the US military umbrella under which they have operated for years yanked away by an isolationist President Trump.
“Turkey is in a position to extract the greatest gains, the greatest advantage from this sequence of events, even if it hasn't been dictating the events, it does look likely to benefit,” said Brew.
On Tuesday, US airstrikes hit the Eastern Syria in the city of Deir Ezzor. The day before, US backed anti-Assad forces took several villages there from Iran and Iran-backed Assad forces.
While regional power politics may mean Israel and Turkey do not seek Assad's outright ouster, Syrian people trapped in the conflict are at the mercy of the country's clashing internal foes.
Syrian's suffered under the human rights abuses of their president but are likely wary of the Islamist insurgents who have pushed out his forces in recent days.
"People now are focusing on survival," said Al-Assil.
Their accounts align with new data showing that Iran has reached its highest-ever divorce-to-marriage ratio.
Iran’s Open Data Center, which provides public access to government-generated data, reports that from March 20, 2023, to March 20, 2024, there were 2.4 marriages for every divorce recorded.
While there were just 481,000 marriages in that timeframe, reportedly the lowest in 27 years – divorces soared up to 202,000, marking the third-highest divorce count on record.
In the 1980s, the national divorce-to-marriage ratio was under 9 per 100 marriages. Since then, it has quadrupled, now approaching 40 divorces for every 100 marriages.
In light of the Iranian government’s crackdowns on individuals speaking to foreign media, some names have been abbreviated or last names omitted.
Professor K., a sociologist, told Iran International how financial instability has driven unprecedented pressure on marriages in Iran.
“When couples can’t afford rent or constantly fear eviction, the sense of security needed to nurture a relationship vanishes,” he said. “Young families feel trapped between rising inflation and unemployment. It’s tearing them apart.”
Trapped in Tehran's rising cost of living
The challenges faced by young couples are evident in the nation’s capital, where Narges and Ali say they once dreamed of buying a small apartment after their wedding.
Today the 29-year-olds have been married for three years and say they have noticed that with each year, rising prices push that dream further out of reach.
Ali told Iran International that they kept hoping the next year would bring some relief to their household finances.
"But after a while, it felt like living in limbo," he said.
In March, a report from state-controlled media indicated that nearly one in three Iranians is living below the poverty line, largely due to the high inflation experienced over the past five years.
At the same time, the government’s own statistics suggest that almost six out of every 10 Iranians are neither employed or seeking work – while more than half of those who are employed are often forced to hold down a side job to make ends meet.
Like many Iranian families, the financial challenges confronting Narges and Ali, have seeped into their personal lives.
“We were just existing,” Narges said. “He worked day and night, and so did I, but each time we saved a little, the rent would go up again. One day, I looked at him, and we both knew—we were just surviving. There was nothing left between us.”
While marriage is in decline, the country is simultaneously facing the threat of a fast-declining population growth rate.
Some studies suggest that by the year 2051, around 26 million of the country's population, or one-quarter of the population, will be elderly.
Despite several massive budget allocations to a regeneration scheme, fewer babies are born each year.
Iran’s government has set an ambitious target to raise the fertility rate to 2.5 by 2028, but critics say the state has not been able to boost the living standards, with more than 35% considered to be living under the absolute poverty line according to official statistics and many more living in increasing hardship despite having multiple jobs.
An examination of rental prices in the capital and the ongoing housing crisis highlights why many families have downsized, relocated to less desirable areas, or are living indefinitely with their parents, as is the case with Leila and her fiancé.
Like Narges and Ali, Leila and her partner say securing a place to live together remains a distant dream for them.
In Tehran, the monthly rent for a one-bedroom apartment in central districts has surged to over 250 million rials (approximately $400), whereas the average household income is around 150 million rials (about $220).
With a master’s degree in accounting, 27-year-old Leila told Iran International that her job prospects are limited, and her savings minimal.
“We’re both working, but after covering expenses, there’s hardly anything left to save,” she says.
Her mother, Farideh, shared, “When I was her age, I was already married, and we had our own place. Now the struggle is just to live, forget about a wedding or children.”
According to the latest data, Alborz province, located just north of Tehran, recorded a rate of 61 divorces for every 100 marriages. Other provinces in the region, including Mazandaran to the north, Tehran itself, Gilan to the northwest, Semnan to the east, and Markazi to the southwest, are also experiencing similar trends.
Economic strain delays marriage in traditional regions
In regions where traditional marriage norms remain strong, divorce rates are lower.
The latest statistics suggest that Chaharmahal and Bakhtiari recorded 30 divorces per 100 marriages and South Khorasan 27 – both closer to the national average.
Meanwhile, Sistan and Baluchestan recorded the lowest rate, with just 10 divorces per 100 marriages.
But, the economic strain in these regions appears to impact overall low marriage rates.
Despite its resource wealth, Sistan and Baluchestan face significant challenges, including underdevelopment and poverty. Reportedly the poorest province of Iran, it has a population of 4 million, which includes about 700,000 Afghan nationals.
Over the past years, the region has experienced many crises, including shortage of fuel, bread, and drinking water, as well as drought, widespread unemployment and increasing poverty.
Hossein, a shop owner in the provincial capital Zahedan, explained that poverty among the youth is fueling disillusionment.
“Young men used to marry in their early 20s. Now, they wait until they can support a family – but that day seems further and further away,” he told Iran International.
Mehri, a 32-year-old teacher and mother of two from Semnan, says she struggles daily with her family’s financial burdens.
Her husband, once an engineer, was laid off, and she says they are now forced to survive and live on her modest teaching salary.
“There’s no peace in our home anymore,” she told Iran International.
Sociologists, including Professor K., caution that the continued trend of low marriage rates could lead to broader social challenges, including increased isolation.
“Marriage has always been a cornerstone of stability in our culture,” said Professor K. “As more families fracture under economic pressures, we risk losing the community bonds that marriage has traditionally helped to strengthen.”
With economic pressures showing no signs of abating, experts say the disintegration of traditional marriage patterns over the last decades will lead to long-term challenges for Iran's social fabric.