As the end of 2025 approaches, Iran's currency has experienced a dramatic collapse.

On Monday, December 29, the Iranian rial plunged to a historic low against the US dollar, prompting the immediate resignation of the central bank governor and sparking the largest protests the country has seen in three years.

Protesters took to the main streets of Tehran. State television reported the resignation of Central Bank Governor Mohammad Reza Farzin. Concurrently, merchants and shopkeepers gathered on Saadi Street in central Tehran and in the Shush neighborhood near the city's Grand Bazaar. The merchants of this market played a pivotal role in the 1979 Islamic Revolution that overthrew the monarchy and brought Islamists to power.

The official IRNA news agency confirmed the protests. Witnesses reported similar gatherings in other major cities, including Isfahan in central Iran, Shiraz in the south, and Mashhad in the northeast. In some areas of Tehran, police fired tear gas to disperse the crowds.

Monday's demonstrations marked the largest since 2022. That year, nationwide protests erupted following the death of 22-year-old Mahsa Jina Amini, who died in custody after being arrested by morality police for allegedly not wearing her headscarf properly.

Witnesses informed the Associated Press that on Monday, merchants shuttered their shops and urged others to do the same. The semi-official ILNA news agency reported that while some stores remained open, many businesses halted transactions.

On Sunday, protests were confined to two major mobile phone markets in central Tehran, where demonstrators chanted anti-government slogans.

That day, the rial plummeted to 1.42 million rials per US dollar. By Monday, the rate had recovered slightly to 1.38 million rials per dollar.

Speculation about Farzin's potential resignation had been circulating for the past week. When he assumed the role of central bank governor in 2022, the rial was trading at approximately 430,000 rials per dollar, indicating a depreciation of over 200% in the last three years.

The currency's rapid devaluation has intensified inflationary pressures, driving up the cost of food and other daily necessities and further squeezing household budgets. This trend is likely to worsen following recent adjustments to gasoline prices.

According to Iran's Statistical Center, the inflation rate in December rose 42.2% year-on-year and increased 1.8% month-on-month. The center reported that food prices surged 72% compared to the previous year, while healthcare product prices jumped 50%. Many critics view this surge as a signal of impending hyperinflation.

Official media reported that the government plans to increase taxes in the new Iranian fiscal year beginning March 21, sparking further concerns.

In 2015, Iran reached a nuclear agreement with the international community, accepting strict controls on its nuclear program in exchange for the lifting of international sanctions. At that time, the exchange rate was 32,000 rials to the dollar. The deal collapsed in 2018 after US President Donald Trump unilaterally withdrew from it.

A 12-day war between Iran and Israel in June ended with a ceasefire, but the risk of renewed conflict persists; many Iranians also fear a potential broader confrontation that could involve the United States, exacerbating market anxiety.

In September, the United Nations reimposed nuclear-related sanctions on Iran through what diplomats called a "snapback mechanism." These measures once again froze Iranian assets abroad, halted weapons transactions with Tehran, and imposed sanctions on Iran's ballistic missile program.

New Central Bank Governor Quickly "Appears" Today, IRNA reported that Abdolnasser Hemmati has been newly appointed as the Governor of the Central Bank of Iran.

The 67-year-old Hemmati has previously served as central bank governor and economic minister under both current and former governments.

Mehdi Tabatabaei, Deputy for Communications and Information Affairs at the Presidential Office, stated on Monday that the president had accepted Farzin's resignation earlier that day and appointed Hemmati as his successor.

The report described Hemmati as an economist and politician who served as Governor of the Central Bank from 2018 until the end of May 2021. He was a reformist candidate in the 2021 presidential election.

Hemmati was appointed as Economic Minister by the current government of President Pezeshkian but was impeached by parliament this past March.

Hemmati will formally assume office after being nominated by the Economic Minister to the cabinet, receiving cabinet approval, and having a decree issued by the president. His appointment process is likely to be finalized during Wednesday's cabinet meeting.

Oil Prices Also Unstable According to International Energy Agency statistics, Iran's daily crude oil production is approximately 3.9 to 4.27 million barrels, ranking seventh or eighth globally. As a major oil producer, Iran has long maintained stable and among the world's lowest gasoline prices. However, this stable price system is now showing signs of strain.

Following the US withdrawal from the nuclear deal in 2018, Iran's oil output plummeted to below 3 million barrels per day. While it has recovered somewhat this year, it has not returned to pre-sanction levels.

In mid-December, Iran introduced a third tier for gasoline prices, marking the first major adjustment to the fuel pricing mechanism since a 2019 price hike triggered nationwide protests.

The new pricing mechanism follows a "use more, pay more" principle with excess charges. Under the revised system, drivers can still purchase 60 liters per month at a subsidized price of 15,000 rials per liter, followed by 100 liters at 30,000 rials per liter. Any gasoline purchased beyond these quotas will cost more than three times the original subsidized price.

Economists warn that this adjustment could exacerbate inflation at a time when the rial's rapid depreciation has already increased the cost of food and other essential goods.

The protests following the 2019 price hike reportedly resulted in over 300 deaths during the crackdown.

Continuing Confrontation with the US and Israel Iranian President Masoud Pezeshkian posted on the X platform today, stating that Iran will deliver a severe and deterrent response to any act of aggression.

He emphasized that Tehran's stance is that any hostile action against Iran will be met with a decisive counterstrike.

According to IRNA, this warning was directed at remarks made by US President Trump during a meeting with Israeli Prime Minister Netanyahu. Trump stated during the meeting that he had heard Iran was seeking to rebuild its military capabilities and said the US would destroy them if true.

Trump also hinted that Washington would swiftly authorize military action against Iran if it continued to advance its missile or nuclear programs.

"The Islamic Republic of Iran states that its missile program is for deterrence and is not subject to negotiation," IRNA reported.

Additionally, a spokesperson for the Atomic Energy Organization of Iran stated at a parliamentary committee meeting today that the organization has achieved three new milestones in the nuclear field. These include successfully launching the country's first fully domestically developed industrial accelerator, commencing advanced production of carbon-13, and restarting a cyclotron used for radiopharmaceutical production.