By BILL SPINDLE, BENOÎT FAUCON and FARNAZ FASSIHI
Iranian authorities sent police into the streets of the capital Monday to crack down on informal currency trading and support the rial, signaling Iranians' heightened insecurity over their dwindling buying power and Tehran's increasingly hard-handed efforts to stave off economic panic.
The move follows last week's steep Iranian Central Bank interest-rate increase, a bid to try to stem the growing demand for U.S. dollars in the country as the economy lurches amid fears over a new round of sanctions promised by the U.S. and Europe.
Iran's rial currency has declined 40% to 55% against the dollar on the black market since December. Iranian inflation, meanwhile, now exceeds 20% a month, according to the Central Bank. While the rial has been falling for almost a year, the latest drop appeared to be triggered by a recent U.S. announcement that it would penalize companies that do business with Iran's Central Bank, and a proposed plan to ban Iranian oil purchases in the European Union later this year.
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