Bazaars closed amid wave of protests over runaway prices in Iran

BarcelonaIranian President Massoud Pezeshkian has called for listening to the "legitimate demands" of the protesters, following two days of demonstrations by shopkeepers in Tehran's bazaars against the rising cost of living and runaway hyperinflation. Shops were closed for denouncing the deteriorating economic situation, exacerbated by the rapid depreciation of the national currency amid Western sanctions. This spontaneous movement began on Sunday in Tehran's largest mobile phone market before spreading and gaining momentum.

An image reminiscent of the 1989 Tiananmen Square protests in Beijing has gone viral: a young man lying alone on the ground between police and a crowd of demonstrators occupying a major thoroughfare in central Tehran, known for its numerous shops. The official Fars news agency admitted that "minor physical clashes have been reported between protesters and law enforcement."

Price increase of 52%

The Iranian currency hit a record low on Sunday, according to the informal black market rate: more than 1.7 million rials per euro (compared to 855,000 a year ago), and Monday's slight recovery did not change the trend. The rial's chronic depreciation causes hyperinflation and high volatility in the country, where some prices rise dramatically from one day to the next. This situation paralyzes sales, as sellers and buyers prefer to postpone transactions until they have more certainty.

Iran has suffered from chronic hyperinflation for years. In December, prices rose by an average of 52% year-on-year, according to official data. However, the increase in the prices of basic necessities is even higher. The Iranian economy, already weakened by decades of Western sanctions, is also affected by the UN's reinstatement in September of international sanctions lifted ten years ago and linked to its nuclear program. The threats made by Donald Trump after his meeting on Monday with Israeli Prime Minister Benjamin Netanyahu may add fuel to the fire.

The government has announced the replacement of the Central Bank governor with Abdolnaser Hemmati. The former Minister of Economy and Finance, who will assume the post on Wednesday, thus returns to the forefront. He had been dismissed in March by Parliament due to the sharp depreciation of the rial.