Iran's currency hits a new record low as war erodes the country's economic stability

Iran’s currency fell to a new record low on Tuesday, with traders in Tehran exchanging more than 2.5 million rials to the U.S. dollar in a stark reflection of how the war in the Middle East has steadily eroded the Iranian economy.

The latest decline came just 27 days after the rial hit its previous record low of 2.2 million to the dollar on Sept. 2. The currency has repeatedly reached new lows since the war began in February.

The Iranian economy has been under duress for years in the face of international sanctions. But a U.S. naval blockade on Iranian oil and new sanctions imposed since the start of the war have sent it into freefall.

Meanwhile, Iran’s top diplomat said indirect negotiations with the United States aimed at reopening the critical Strait of Hormuz have become “more serious,” while the Iranian Revolutionary Guard Corps’ chief spokesman Gen. Hossein Mohebbi on Tuesday called on Americans to take to the streets and protest the conflict.

Iran's top diplomat raises the prospect of new talks

Foreign Minister Abbas Araghchi told Iranian media late on Monday that the “current focus is solely on the Strait of Hormuz,” the chokepoint of the war.

Araghchi made the comments shortly before departing New York — where he attended last week’s gathering of world leaders at the U.N. General Assembly — and after meeting with Pakistani and Qatari mediators.

Araghchi said that the Qatari intermediaries were expected to soon engage with the U.S. side.

“They are set to raise the matter with the American side once more, after which the final U.S. response will be conveyed to us,” Araghchi said. “If there is a response, the Qataris will convey it to us and a decision will be made in Tehran on that basis.”

Officials, including from the U.S., have confirmed to The Associated Press that mediators are working with Iran and the U.S. on trying to broker a deal to end the fighting and open the strait.

The mediation efforts continue even after U.S. President Donald Trump earlier this week spurned an Iranian proposal to reopen the strait in seven days if the U.S. agreed to lift its blockade of Iranian ports, release frozen Iranian assets and waive sanctions on Iranian oil sales, among other conditions.

Iran sends a provocative message to the US public

The Iranian Revolutionary Guard Corps on Tuesday made an appeal to everyday Americans to push their government to end the U.S. war against Iran, a provocative message that comes just weeks before critical midterm elections in the United States.

Mohebbi, the Guard spokesman, read a letter during a news conference in Iran's capital, Tehran, appealing to Americans to pressure their government and claiming that the only way for the war to end is for Washington to admit defeat and leave the Mideast.

Mohebbi’s remarks come as Trump’s Republican party faces fierce headwinds as it looks to maintain control of Congress. But polling shows the war has darkened the American electorate’s mood ahead of the Nov. 3 election in which elevated gasoline prices, a byproduct of the conflict, loom large.

Mohebbi also accused the U.S. of using Iran’s nuclear program as a ruse to “plunder Iran’s wealth” and to turn the country “back into a colony.”

He added that the U.S. and others failed in their belief that military and economic action would get Tehran to submit and that Washington “has no choice but to acknowledge defeat and leave the region.”

“This is how the war will end,” he said.

Trump and his top aides are insistent that Iran’s economy cannot sustain a conflict much longer and have expressed confidence that Tehran will be forced to capitulate.

The U.S. president predicted soon after launching the war that the conflict would last a matter of weeks. More recently, he’s said that the war will likely end after the November elections in the U.S.

U.S. Secretary of State Marco Rubio in a Monday appearance on Fox News said Iran was heading toward an economic “cataclysm.” Administration officials say that a combination of new sanctions and a U.S. naval blockade aimed at preventing Iranian oil from going to market are having the intended effect.

“And so when you’re denying them money through oil sales and sanctions, you’re not just punishing them,” Rubio said. “You are preventing them from getting access to money that they will use to try and kill Americans and others around the world and their own people and build weapons and threaten the world and ultimately break out to a nuclear weapon program.”