Iran seeks to stabilize economy by cutting four zeros from Rial

Iran’s Parliament on Sunday approved a bill to remove four zeros from the national currency, the rial, which has been steadily depreciating amid renewed international sanctions that have hit the country’s economy hard.

The decision comes a week after the reimposition of United Nations sanctions that had been lifted a decade ago, sending the rial to record lows against the U.S. dollar.

Under the approved plan, 10,000 current rials will be replaced by one new rial, according to the Parliament’s official website. The measure still requires approval from the Guardian Council, which reviews legislation, and the signature of President Massoud Pezeshkian before taking effect.

The bill allows for a three-year transition period during which both the old and new versions of the rial will circulate simultaneously. On Sunday, one U.S. dollar traded on the unofficial market at about 1.1 million rials, compared to around 920,000 in early August when the plan was first introduced, according to several exchange monitoring sites.

Iranians have long used the informal term “toman”—equal to ten rials—for everyday transactions. However, this dual usage has caused confusion, particularly for foreign visitors and even some locals.

The currency reform aims to simplify transactions and restore confidence in the rial, though analysts note that without deeper economic changes and sanctions relief, the impact may remain largely symbolic.