Iran’s rial currency has lost nearly half its value against the dollar in 2025, with inflation reaching 42.5% in December in a country where unrest has repeatedly flared in recent years and which is facing U.S. sanctions and threats of Israeli strikes.
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President Masoud Pezeshkian said in a social media post late on Monday that he had asked the interior minister to listen to “legitimate demands” of protesters. Government spokesperson Fatemeh Mohajerani said a dialogue mechanism would be set up and include talks with protest leaders.
“We officially recognise the protests … We hear their voices and we know that this originates from natural pressure arising from the pressure on people’s livelihoods,” she said on Tuesday in comments carried by state media.
PROTESTERS MARCH STREETS IN TEHRAN
Video of protests, verified by Reuters as taking place in Tehran, showed scores of people marching along a street chanting “Rest in peace Reza Shah”, a reference to the founder of the royal dynasty ousted in the 1979 Islamic revolution.
Footage aired on Iranian state television on Monday showed people gathered in central Tehran chanting slogans.
The semi-official Fars News Agency reported that hundreds of students held protests on Tuesday at four universities in Tehran.
On social media, some Iranians voiced support for the protests with one, Soroosh Dadkhah, saying high prices and corruption had led people “to the point of explosion” and another, Masoud Ghasemi, warning of protests spreading across the country.
Iranian authorities have quashed previous bouts of unrest that have flared over issues ranging from the economy to drought, women’s rights and political freedoms, with violent security actions and widespread arrests.
The government has not said what form dialogue will take with the leaders of this week’s demonstrations, the first major protests since Israeli and U.S. strikes on Iran in June, which prompted widespread expressions of patriotic solidarity.
Pezeshkian said in a meeting with trade unions and market activists on Tuesday that the government will do its best to resolve their issues and address their worries, according to state media.
Item 1 of 5 People walk through a local market as the value of the Iranian rial drops, in Tehran, Iran, December 20, 2025. Majid Asgaripour/WANA (West Asia News Agency) via REUTERS/File Photo
SANCTIONS HAMMER ECONOMY
Economic disparities between ordinary Iranians and the clerical and security elite, along with economic mismanagement and state corruption – reported even by state media – have fanned discontent at a time when inflation is pushing many prices beyond the means of most people.
The currency slid to 1.4 million rials to the U.S. dollar on Tuesday according to private exchange platforms, a record low after starting the year at 817,500 rials to the dollar.
Monthly annualised inflation figures have not dropped below 36.4% since the Iranian new year started in late March according to official figures.
The U.S. and Israel carried out 12 days of airstrikes on Iran’s military and its nuclear installations in June aimed at stopping what they believe were efforts to develop the means to build an atomic weapon.
Iran says its nuclear energy programme is entirely peaceful and that it has not tried to build a nuclear bomb.
Reporting by Elwely Elwelly; additional reporting by Aaron McNicholas and Bahareh Khodabandeh; writing by Angus McDowall; editing by Mark Heinrich and Sharon Singleton
Our Standards: The Thomson Reuters Trust Principles.
