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THURSDAY, 17 APR 2014
06:29 PM Beirut time
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Protest, scuffles with police in Iran over currency crisis
Agence France Presse
A money changer holds Iranian rial banknotes as he waits for customers in Tehran's business district in this January 7, 2012 file photo. (IRAN-CURRENCY/ REUTERS/Raheb Homavandi/Files)
A money changer holds Iranian rial banknotes as he waits for customers in Tehran's business district in this January 7, 2012 file photo. (IRAN-CURRENCY/ REUTERS/Raheb Homavandi/Files)
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TEHRAN: A protest and scuffles with police occurred in central Tehran on Wednesday in the first sign of public unrest over Iran's plunging currency, which has lost more than half of its value since last week.

Hundreds of police in anti-riot gear stormed the capital's currency exchange district of Ferdowsi, arresting illegal money changers and ordering licensed exchange bureaux and other shops closed, witnesses told AFP.

Several arrests were seen, carried out by uniformed police or plain-clothes security officers.

Smoke was seen in two places in the area.

Some appeared to come from at least two dumpsters set on fire, one of which was near the British embassy -- evacuated last year after pro-government demonstrators stormed it.

The source of the other smoke could not be determined, with police directing pedestrians and vehicles away.

Individuals threw stones at police officers and a police car before running away, witnesses said.

A protest in Tehran's historic Grand Bazaar -- a maze-like complex of shops vital to the city -- also took place but was quickly put down by police.

"We closed because we don't know what is going to happen" in terms of the currency market, one shopkeeper said.

A police commander, Colonel Khalil Helali, was quoted by the Mehr news agency as saying 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 crackdown was an apparent bid to halt a dramatic plunge in the value of Iran's currency this week.

On Tuesday, President Mahmoud Ahmadinejad said Western sanctions were mostly to blame. But rivals said his mismanagement of the economy was the main cause.

Iran's supreme leader, Ayatollah Ali Khamenei, vowed again on Wednesday that his country would not cede to Western pressure over its disputed nuclear programme.

"The aim of the pressure against the Iranian people is to make it yield. But it will never yield. That's why the enemy is angry," he said in a speech reported by the ISNA news agency.

Money changers said virtually no transactions were taking place in the market, making any valuation unreliable, but the rate was estimated to be around 36,000 to the dollar, about the same level as at the close of trade on Tuesday.

Online websites that normally track the currency market were censored, none giving the rial's value against the dollar.

A week ago, the rial was trading at around 22,000 to the greenback and at 13,000 a year ago.

The money's plunge has greatly increased inflation in Iran, which is widely seen as far higher than the official 23.5 percent given by the central bank.

Food costs, notably, have spiralled, to the concern of Iranian families. Merchants, some of whom have lost millions of dollars in a day, say doing business has become nearly impossible.

The US government has said it sees the rial's plunge as proof Western sanctions are having a big impact on the Islamic republic's economy.

But Ahmadinejad said that, even with the "psychological war on the exchange market," Iran would not be pressured into curbing its nuclear activities -- the stated aim of the sanctions.

"We are not a people to retreat on the nuclear issue," he told a news conference in Tehran.

 
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