Iran rial rallies against dollar on potential Joe Biden victory over Donald Trump

A Biden Presidency could end multi-sector sanctions, boosting economy

A man walks by the Ministry of Oil in Tehran, Iran, on 27 October 2020. The Ministry and related organisations had recently been targeted in a new round of US sanctions. EPA photo

Iran's troubled currency rose to a six-week high against the US dollar on Saturday, helped by central bank cash injections and hopes of reduced US sanctions after a possible presidential election victory by Joe Biden.

The dollar was selling for about 268,000 rials on the unofficial market, down from 281,000 on Friday, according to foreign exchange site Bonbast.com. The business daily Donya-e-Eqtesad's website also gave the dollar rate as 268,000 rials, down 12,000 rials from Friday.

Iranian media have quoted analysts as saying the rial was partly gaining on hopes of an election victory over Republican President Donald Trump by the Democratic candidate, who may curb the sanctions that have crippled Iran's economy.

The currency has still lost about 50 per cent of its value in 2020 under the economic impact of US sanctions and the coronavirus pandemic in the country with the highest Covid-19 death toll in the Middle East.

"The most influential factor in the Iranian foreign exchange market in recent weeks is probably the outcome of the US election," the economic news website tejaratnews.com said.

Analyst Sohrab Ashrafi told the website: "If Biden is elected, this may create a psychological atmosphere that could lead to lower [dollar] rates quickly, but [I] believe this reduction will be temporary."

The central bank said on its website on Thursday that it had pumped an average of $70 million per day into the currency market on the previous seven days.