Iran will defeat a “conspiracy” against its foreign currency and gold markets, an adviser to Iranian Supreme Leader Ayatollah Ali Khamenei said on Friday, with pressure mounting on the authorities to deal with the rapid collapse of the rial.
Riot police fought demonstrators and arrested money-changers in and around the Tehran bazaar on Wednesday during protests triggered by the fall of the Iranian currency, which has lost a third of its value against the US dollar over the past 10 days.
Protesters called Iranian President Mahmoud Ahmadinejad a traitor because of what many say is his serious mismanagement of the economy, which has been badly hit by US and European sanctions imposed over Iran’s nuclear program.
There has so far been no public criticism of Khamenei, the Islamic Republic’s most powerful authority.
“Iran is overcoming the psychological war and conspiracy that the enemy has brought to the currency and gold market and this war is constantly fluctuating,” said close Khamenei ally Gholam Ali Haddad Adel, according to Fars news agency.
“The arrogant powers … think the nation of Iran is ready to let go of the Islamic revolution through economic pressure, but we are establishing Iran’s economic strength,” he said.
Iranian media reported harsh words for Ahmadinejad’s government at Friday prayer sermons across the country.
“In my view only a small percentage of the economic problems and inflation is related to the enemy sanctions and the main reason is the erroneous economic policies,” Ayatollah Seyed Yousef Tabatabai-Nejad said in Esfahan, Mehr news agency reported.
“The day you took the votes … did you know this country and its people are revolutionary?” Fars news reported Ayatollah Ahmad Alhoda as saying in apparent reference to Ahmadinejad.
“If you knew that you can’t confront these problems and crises, but told people you can, you have undoubtedly betrayed their rights,” Alhoda added.
Washington says the fall in the rial over the past year has been caused by both economic mismanagement and sanctions, which the administration of US President Barack Obama and the EU tightened sharply this year.
Iran’s leadership could “relieve the pressure its people are feeling” if it resolves concerns about its nuclear work, US Treasury undersecretary for terrorism and financial intelligence David Cohen said in London.
Aides to senior US lawmakers said on Friday they were looking at even more drastic sanctions to isolate Iran from the international financial system.
Most of Tehran’s bazaar was shut on Thursday, but business associations said it would reopen yesterday under the supervision of the security forces.
It is traditionally closed on Fridays.
Analysts say any further discontent could spread quickly if it is allowed to gain a foothold.
The bazaar, whose merchants were influential in bringing an end to Iran’s monarchy in 1979, wields significant influence and this week’s unrest is a clear signal that the economic hardship is having a profound effect on businessmen and residents alike.
“This is a very serious situation. There is a lot of pressure on Khamenei to remove Ahmadinejad, but they will need to find a way to do it without losing face,” said Iranian-born Mehrdad Emami, an economics adviser to the EU.
“Ahmadinejad is pushing ahead and that could create continuing unrest which will need a lot of security on the streets,” he added.