Iran's central bank governor blames protests and US sanctions for high inflation

The country has been gripped by demonstrations for two months

People clash with police in Tehran following the death of Mahsa Amini. EPA

Iran’s central bank governor has blamed nationwide protests for soaring inflation, which has seen the currency drop by around 20 per cent in value since demonstrations began in mid-September.

Ali Salehabadi said that US sanctions, in addition to “the events of the past two months,” had worsened the country’s economic travails.

Iran has been gripped by protests and riots since September 16 when an Iranian-Kurdish woman, Mahsa Amini, died in the custody of the country’s morality police, who accused her of violating the country’s strict dress code for women.

Iranians protest in Tehran after the death of 22-year-old Mahsa Amini after she was detained by the morality police in September. AP Photo

Protests have intensified despite a vicious government crackdown that has left as many as 200 people dead, although estimates of the toll by rights groups vary. AP Photo

At least eight members of the security forces have also been killed or wounded during the unrest and there are signs that violent resistance could be intensifying. AP Photo

A fire burns at the office of the governor of Mahabad, in the West Azerbaijan province of Iran. AFP

Protesters gather in the a courtyard of Chitgar complex in western Tehran. AFP

Iranian protesters continue to defy a deadly crackdown by security forces. AFP

A woman cuts her hair at the grave site of Nika Shahkarami in the city of Khorramabad, during a reported memorial held to mark 40 days since the death of the 16-year-old. AFP

A woman not wearing a headscarf stands on top of a vehicle as thousands make their way towards Saqez, Mahsa Amini's home town, to mark 40 days since her death in police custody. AFP

Iranian riot police prepare to confront protesters the capital, Tehran. AFP

Iranian protesters surge forward amid clashes with riot police in Tehran. AFP

A crowd blocks an intersection during a protest to mark 40 days since Amini's death in custody. AP Photo

Iranian police arrive to disperse a protest in Tehran. AP Photo

Protesters chant at a vigil for Amini at the Khajeh Nasir Toosi University of Technology in Tehran. Reuters

Students at Sharif University of Technology attend a protest. AP Photo

Police outside Sharif University during a student protest. AP Photo

Students at the university protest over the death of Amini, who was in 'morality police' custody for allegedly breaking strict rules on head coverings for women. AP Photo

The students' banner says: 'No to mandatory hijab'. AP Photo

Around 15,000 people have been arrested since then, the UN says, while estimates for the number of people killed in a security crackdown range from a government count of 200 to more than 500, an estimate made by rights groups.

Protests have not directly targeted economic activity, however trade unions have mounted a number of strikes in protest against police brutality, with industrial action spreading from the education sector to the oil and gas industry and also hitting steel production.

Mr Salehabadi replaced Afshin Khani as head of the central bank last week, after his predecessor resigned amid spiralling inflation.

Iran's troubled currency fell to a new low against the US dollar on Saturday as Iranians desperate to find safe havens for their savings have been trying to buy dollars, other hard currencies or gold.

The dollar sold for as much as 395,600 rials on the unofficial market, up from 386,800 on Friday, according to foreign exchange site Bonbast.com.

The economic daily Donya-e-Eqtesad’s website gave the dollar rate as 382,300, up 1.2 per cent from Friday.

In May 2018, the currency was trading at about 65,000 per US dollar just before the US withdrew from Iran's nuclear deal with world powers and reimposed sanctions on the country.

A video shared on Twitter by 1500tasvir, an account that has 400,000 followers, showed what it said was a metro station in Tehran on Saturday with the crowd chanting, "Political prisoners must be freed!"

Protests also continued in key sectors of the economy, threatening to worsen the country's precarious situation.

Workers in Iran’s oil and gas sector went on strike in several districts on Saturday, with unverified footage published on social media showing dozens of employees from state-owned oil and gas companies holding rallies across the southern cities of Ahvaz, Asalouyeh, Mahshahr and Gachsaran.

The walkouts reportedly involved employees from Pars Oil, the operator of the giant South Pars gas field in the Arabian Gulf, as well as the National Iranian South Oil Company, which runs 45 oil and gas fields and is responsible for around 80 per cent of Iran’s crude production, according to the companies’ websites.

Footage showed workers holding placards that read “We will not back down from our rights.”

Meanwhile, an inmate died in one of Iran's largest prisons on Saturday, state media reported, as concern mounts about the safety of prisoners arrested during anti-regime protests.

A “limited scuffle” in Iran’s Central Prison of Karaj left one prisoner dead after he was pelted with stones by other prisoners, the state-run Islamic Republic News Agency reported, citing Hossein Fazeli, the public prosecutor of Alborz province.

The clash erupted in a wing for drug offenders, where prisoners also set fire to a number of blankets in the prison yard, Mr Fazeli said, without elaborating on what set the conflict in motion. The prison is on the outskirts of the city of Karaj, some 40km west of Tehran.

The violence follows a fire that killed eight inmates in October in Tehran’s Evin prison, where numerous political activists and journalists are jailed.