Posted at 11:53 AM ET, 10/03/2012

Police clash with protesters in Tehran’s bazaar [video]

Merchants in Tehran’s bazaar, a financial ally of the Iranian government, went on strike Wednesday against the plunging value of the national currency, which reached an all-time low of 34,000 rials to one U.S. dollar this week.

Iran’s semiofficial Mehr news agency said the bazaar was closed for security reasons and police promised to “deal with” shopkeepers who had shut their doors.

Protesters also gathered in Tehran’s Toopkhoneh Square, Global Voices reports.

Police used tear gas to disperse the demonstrators, hundreds of whom marched to Iran’s central bank and chanted anti-government slogans, according to the BBC.

Some news sites reported that the demonstrators shouted slogans urging the government to end its alleged financial support of Syria and to think of the Iranian people instead:

The fall of the rial stems from both U.S.-led economic sanctions and poor fiscal policy.

“The rial’s sharp decline is attributed to a combination of Western sanctions and government policies — such as fueling inflation by increasing the money supply while also holding down bank interest rates. That prompted many people to withdraw their rials to exchange for foreign currency over the past months,” the AP reports.

This week, Iranian President Mahmoud Ahmadinejad blamed the currency troubles on a “psychological war” perpetrated by enemies abroad.

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By  |  11:53 AM ET, 10/03/2012

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