US slaps sanctions on Iran's currency

The US has slapped new sanctions on Iran for the third time in a week, targeting the country's already-devalued currency and automobile industry, as it pressured Tehran to abandon its nuclear programme.

This is the first time the US has directly targeted the Iranian currency as the sanctions include penalties on anyone facilitating "significant" transactions in the rial or holding significant amounts of the currency outside Iran. The fresh actions, contained in an executive order effective July 1, were issued by US President Barack Obama.

This is the ninth set of sanctions that the Obama administration has imposed against Iran. Last week, the US blacklisted companies in Iran's petrochemical industry for the first time and issued sanctions against more than 50 Iranian officials for what it called their efforts to stifle political dissent in Iran.

"This new action targets Iran's currency, the rial, by authorising the imposition of sanctions on foreign financial institutions that knowingly conduct or facilitate significant transactions for the purchase or sale of the Iranian rial, or that maintain significant accounts outside Iran denominated in the Iranian rial," White House Press Secretary Jay Carney said yesterday.

"While the rial has lost half of its value since the beginning of 2012 as a result of our comprehensive sanctions, this is the first time that trade in the rial has been targeted directly for sanctions," he said.

The executive order also authorises the imposition of new sanctions against those who knowingly engage in significant financial or other transactions for the sale, supply, or transfer to Iran of significant goods or services used in connection with Iran's automotive sector, one of the key employers and contributors to the country's economy. Similar sanctions were earlier imposed on Iran's shipping, shipbuilding, and energy sectors.

Later addressing a meeting of the American Jewish Community Global Forum, Secretary of State John Kerry said that America would not allow Iran to acquire nuclear weapons.

"The US will prevent Iran from acquiring a nuclear weapon. It is not prevention. It is no weapon, no containment; prevention," he said.

The West accuses Iran of covertly pursuing nuclear weapons programme, a charge denied by Tehran which says its atomic programme is for peaceful use of nuclear energy.