Iran Currency Collapse Is Fueling Protests — and Why the Crisis Now Puts Pressure on the UK

For the UK, the crisis has immediate consequences. Iranian diaspora groups have stepped up protests in London, ministers face renewed scrutiny over sanctions policy, and officials are monitoring potential knock-on effects for regional stability, energy markets and future asylum claims.

Currency Collapse Deepens Economic Strain

Iran's national currency has fallen to record lows on the open market, trading at around 1.4 million rials to the US dollar, according to regional business reporting. Ten years ago, the exchange rate stood at a fraction of that level.

The decline has pushed inflation above 40 per cent, raising the cost of food, fuel and housing. Iranian households have seen savings lose value rapidly, while wages have failed to keep pace with rising prices, according to Iranian media reports.

Western sanctions targeting Iran's oil exports, banking system and access to global finance have constrained government revenue and foreign currency reserves. These pressures have limited Tehran's ability to stabilise the rial or contain inflation, leaving the economy vulnerable to external shocks and internal mismanagement.

Protests Spread Across Cities

Demonstrations initially centred on traders, shopkeepers and workers affected by currency losses. International media reports indicate that protests later spread to universities and residential neighbourhoods in dozens of cities.

Slogans and chants have increasingly criticised economic mismanagement and corruption, reflecting frustration over falling living standards and limited job prospects. Authorities have acknowledged unrest in several regions while warning against what they describe as foreign interference.

Independent verification has been difficult due to restrictions on internet access and reporting. News organisations have relied on intermittent footage, eyewitness accounts and information from outside the country to track developments.

Why the Crisis Matters to the UK

The unrest has prompted renewed demonstrations in London and other UK cities, with Iranian-British groups calling on the government to take a firmer stance on human rights and political freedoms. UK-based protests have drawn attention to the domestic political impact of events in Iran.

The UK has maintained sanctions linked to Iran's nuclear and missile programmes, aligned with US and European partners. Ministers have said the measures are intended to curb proliferation, though critics argue that economic pressure falls most heavily on civilians.

There are also strategic concerns. Iran remains a significant regional power and energy producer. Prolonged instability could affect oil markets and shipping routes, with potential implications for energy prices in the UK and Europe.

Humanitarian and Migration Concerns

Human rights organisations have warned that sustained economic deterioration could increase migration pressures, as Iranians seek safety or economic opportunity abroad. European governments, including the UK, face calls to prepare for potential asylum claims linked to political repression and economic hardship.

British officials have not announced any immediate changes to asylum policy but have reiterated support for diplomatic efforts aimed at reducing regional tensions.

Iran's currency collapse has evolved into a crisis with international consequences. As inflation rises and protests continue, the impact is being felt beyond Iran's borders, drawing in countries such as the UK through diplomacy, sanctions policy and humanitarian considerations. With no clear path to economic stabilisation, the situation remains a source of uncertainty for both Iranians and their international partners.