Iranian riot police have clashed with protesters in the capital Tehran over the collapse of the rial, the country's currency, which has lost a third of its value against the dollar in a week. Police on Wednesday reportedly fired tear gas to disperse demonstrators, including currency exchange dealers. It was the first sign of public unrest over the plunging currency. The fall of the rial, which has now lost more than 80 per cent of its value compared with a year ago, with 17 per cent of its value shed on Monday alone, has been largely blamed on Western sanctions imposed over the country's nuclear programme. The rial slipped another four per cent on Tuesday to close at 36,100 to the dollar, according to exchange tracking websites. Hundreds of police in anti-riot gear stormed the capital's currency exchange district of Ferdowsi, arresting illegal money changers and ordering licenced bureaus and other shops closed, witnesses said. Several arrests were seen, carried out by uniformed police or plain-clothes security officers. A protest in Tehran's historic Grand Bazaar - a complex of shops vital to the city - also took place but was quickly put down by police. Khalil Helal, a police commander, was quoted by the Mehr news agency as saying that police were going to take action against shopkeepers who closed their businesses, for "disturbing" the situation. The head of the national police, Esmail Ahmadi Moghadam, was quoted by the Fars news agency as saying a special unit comprised of police chiefs and government economic officials had been created "to combat those perturbing the currency market." He added that many people were keeping stashes of foreign currency and gold at home, "which is having a negative effect on the economy". The protests came after Mahmoud Ahemedinjad, Iran's president, said that his country will press on with its nuclear programme despite the problems caused by Western sanctions, including a dramatic slide in its currency's value. "We are not a people to retreat on the nuclear issue," he told a news conference in Tehran on Tuesday. "If somebody thinks they can pressure Iran, they are certainly wrong and they must correct their behaviour," he said. Ahmadinejad said the currency plunge was part of an economic "war" waged by the West on the Islamic republic and "a psychological war on the exchange market." Iran, he said, had sufficient foreign currency reserves. Those reserves were estimated at about $100bn at the end of last year, thanks to surging oil exports.
