Iranian police crack down on currency trading

Thomas Erdbrink / New York Times News Service /

Published Oct 9, 2012 at 05:00AM

TEHRAN, Iran — Iranian police officers moved to arrest unlicensed currency dealers and increase patrols in the center of the capital Monday in order to prevent unofficial trading from disrupting new government-imposed rates of exchange for the national currency, the rial.

Over the past few days Iran’s leaders have sought to stabilize the value of their currency, after a market panic last week when the rial fell by about 40 percent against the U.S. dollar and other foreign currencies.

Now, only those traders licensed by Iran’s Central Bank may buy and sell the rial for foreign currency, and at rates that value the rial at 25,500 to the dollar — substantially more than last week, when it took as many as 37,500 rials to buy one dollar.

But the new restriction on unofficial trading also had an adverse effect, causing lines of customers who wanted to sell their rials at the better rate in anticipation that it would eventually weaken again. Several authorized money traders refused to sell foreign currency in large quantities and some hired private security companies in order to regulate the flow of customers.

In an additional measure to help ensure that the state’s foreign currency would be used only to buy the most important imports, a member of parliament said all luxury imports had been forbidden.

The politician, Gholamreza Mesbahi-Moghaddam, also said parliament has been preparing to discuss the suspension of the second phase of President Mahmoud Ahmadinjead’s subsidy reform plan, Iran’s English-language state television channel Press TV reported. The lawmaker stressed that people would continue to receive a monthly cash payment, which the government is due to deliver in a week’s time.

Think tank talks

nuclear warhead

VIENNA — Iran could produce enough weapons-grade uranium to arm a nuclear bomb within two to four months but would still face serious “engineering challenges” — and much longer delays — before it succeeds in making the other components needed for a functioning warhead, the Institute for Science and International Security, a respected U.S. think tank, said Monday.

While Iran denies any interest in possessing nuclear arms, the international community fears it may turn its peaceful uranium enrichment program toward weapons making — a concern that is growing as Tehran expands the number of machines it uses to enrich its stockpile of enriched uranium. As those fears grow, so does concern that Israel could carry out its threats to attack Iran’s nuclear facilities before that nation reaches the bomb-making threshold.

For now, U.S. military and intelligence officials say they don’t believe Iran’s leadership has made the decision to build a bomb, while also warning that the country is moving closer to the ability to do so.

— The Associated Press