The Iranian parliament on Sunday passed legislation to remove four zeros from the national currency, the rial, in an attempt to stabilize its currency after it has witnessed a remarkable decline due to the renewed sanctions, according to AFP.
The approval came two months after a parliamentary commission revived the long-delayed proposal that sought to streamlines financial transactions, according to the legislature’s website.
Under the new plan, 10,000 rials will be converted into a single new rial.
Notably, both the old and new rials will remain in circulation for up to three years.
Meanwhile the central bank has been given two years to launch the transition.
In August, the European countries triggered the “snapback” mechanism to reimpose the international sanctions over Tehran’s non-compliance.
After the reimposition of UN sanctions, the rial has suffered repeated record lows, black market trackers reported.
On Sunday, the rial traded at approximately 1,115,000 to the U.S. dollar, up from roughly 920,000 when the redenomination plan was revived in early August.
Currently, the move should be approved by the Guardian Council and signed by President Masoud Pezeshkian to take effect.
Iranians started to adopt the use of the Toman for most transactions which means that they drop a zero from the rial and use the resulting figure.
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