The Iranian rial slid further on Thursday, with the US dollar trading around 957,000 rials in Tehran’s free market, as markets braced for the possible reinstatement of UN sanctions through the so-called "snapback" mechanism.
Sterling reached 1,289,000 rials while the gold coin climbed to 860 million rials, reflecting safe-haven demand amid currency weakness.
The losses come ten days before the European powers' deadline to decide on triggering the mechanism that could reimpose UN sanctions on Iran. Washington has also vowed to halt Tehran’s oil exports to China as part of its maximum pressure campaign.
The snapback mechanism, part of UN Security Council Resolution 2231 that endorsed the 2015 nuclear deal between Tehran and world powers, allows any party to restore UN sanctions if Iran is accused of non-compliance.
France, the UK and Germany have warned Iran they will restore UN measures unless talks resume and produce results by the end of August.
Experts say the looming deadline is driving the rial's downfall. Iranian officials, however, have sought to play down the potential economic fallout of renewed sanctions.
Earlier this month, Foreign Minister Abbas Araghchi said that the consequences of the snapback mechanism had been “exaggerated” and made to appear more serious than they are.
Last week, Iran International reported that Iran’s Ministry of Intelligence has issued confidential guidance to ministries and major companies to prepare for the possible return of punitive UN measures.
The ministry warned of “severe currency fluctuations, reduced purchasing power, increased unemployment, layoffs and heightened social discontent” if sanctions return, and urged companies to seek alternative suppliers in countries including China, Russia and Iraq.
The exercises, dubbed Sustainable Power 1404, featured the simultaneous use of Nasir, Qadir, and Ghader anti-ship cruise missiles launched from coastal batteries and warships, including the Genaveh missile boat and the Sabalan destroyer.
“These missiles, with different ranges, successfully hit their designated targets at sea,” the semi-official Tasnim news agency said. Officials described the systems as radar-evading, high-precision and designed to counter both naval and coastal targets.
The drills took place around a month after the Iran-Russia drill under the name Casarex 2025, which took place in Iran's northern waters -- the Caspian Sea.
Marking National Defense Industry Day, Iran’s Defense Ministry said the country had advanced “from the peak of dependence on foreigners to the heights of self-sufficiency and power” in the missile, weapons and space sectors.
It warned that “any miscalculation in the region will be met with a very strong response from Iran’s powerful armed forces.”
The ministry said the 12-day war in June had demonstrated the effectiveness of Iranian weaponry, adding that Tehran’s defense industry will continue to expand without a moment of hesitation.
Army Navy vs Guard Navy
Iran maintains two distinct naval forces under separate command structures: the conventional Islamic Republic of Iran Navy -- a force within the traditional army --and the Islamic Revolutionary Guard Corps Navy.
While both are tasked with defending Iranian interests at sea, their missions, capabilities and areas of operation differ, according to a Defense News analysis.
“The IRGC Navy and the Iranian Navy have two separate command structures. While some of their responsibilities overlap, the primary difference is the methods and strategies of operation,” analyst Sina Azodi told Defense News.
He added that the IRGC Navy emphasizes asymmetric operations, relying on fast boats, missile-equipped vessels and hit-and-run tactics, while the traditional Navy deploys larger platforms such as frigates, corvettes and submarines.
According to Mohamed al-Kenany, head of the military studies unit at the Cairo-based Arab Forum for Analyzing Iranian Policies, another key distinction is geography.
Iran’s navy patrols the Gulf of Oman, the Indian Ocean and the Caspian Sea, while the Revolutionary Guard controls the Persian Gulf and the Strait of Hormuz, where it has seized Western vessels and shadowed US warships during past tensions.
Al-Kenany added that the IRGC’s use of naval mines and swarms of small craft makes its anti-access strategy in the Persian Gulf highly effective, while the conventional Navy remains constrained by aging 1970s-era frigates and corvettes and sanctions that block modernization.
Since 1979, the United States has imposed sanctions on Iran that restrict access to advanced military technology, forcing Tehran to rely on indigenous development and adaptations of older systems.
Top commanders call for modernization
Armed Forces Chief of Staff Major General Abdolrahim Mousavi said Iran’s only guarantee of security was to continually upgrade its systems.
“The only way to shield the country from threats is to enhance deterrence and modernize our ground, naval, aerospace, air defense, cyber and electronic warfare capabilities,” he said in a message to Defense Minister Brigadier General Aziz Nasirzadeh.
Nasirzadeh himself told reporters on Wednesday that Iran had developed a new generation of missiles with greater capabilities than those used in the June conflict.
“The missiles we used in the 12-day war were built several years ago. Today we possess missiles with far better capabilities, and if the Zionist enemy embarks on another adventure, we will certainly use them,” he said.
He added that Israel’s missile-defense systems, including the US-made THAAD, Patriot, Arrow and Iron Dome, had proven ineffective. “In the early days, about 40% of our missiles were intercepted, but by the end of the war, 90% were striking their targets,” he said.
'War is not over'
Earlier in the week, Senior Revolutionary Guards general Yahya Rahim Safavi, now top adviser to Supreme Leader Ali Khamenei, dismissed the June ceasefire as temporary.
“We are not in a ceasefire, we are in a stage of war. No protocol, regulation, or agreement has been written between us and the US or Israel. I think another war may happen, and after that, there may be no more wars,” he said.
Safavi argued that Iran must continue to expand its diplomatic, cyber, missile and drone capabilities. “In the system of nature, the weak are trampled. Therefore, Iran must also become strong,” he said.
Israel vows readiness
Israel’s military chief Lt. Gen. Eyal Zamir said earlier this month the June campaign had been a preemptive strike to eliminate an “emerging existential threat” from Iran.
“If necessary, we will know how to act again with precision, intensity and lethality,” he said.
Israel launched surprise strikes on June 13 that killed senior Iranian commanders and nuclear scientists and damaged nuclear and air defense sites. Iran says 1,062 people were killed, including 786 military personnel and 276 civilians.
Iran retaliated with missile and drone attacks that killed 31 civilians and one off-duty soldier in Israel. The conflict ended with a US-brokered ceasefire on June 24.
Both Tehran and Tel Aviv claimed victory in June, but the rhetoric since then has underscored the fragile truce and the risk of a renewed confrontation in the region.
“These children in practice have no fuel for learning, and teachers and principals, because there is not even a single grocery store near the school, cannot provide them with food and often have no choice but to send students home after such incidents,” the report said.
Ronak Rostami, a social activist, told Shargh that malnutrition has become a serious problem in schools. “Many children suffer from stomach aches, abdominal pain, and general weakness, which prevents them from making effective use of classroom time,” she said.
Students in villages often leave home around six in the morning with only dry bread and a little dried yogurt to eat on their way, she added.
Broader warnings
This is not the first time media in Iran have raised alarms about child malnutrition. A study published by the daily earlier this month, based on data from non-governmental organizations and volunteers, found that only 1.7 percent of households consume protein daily, while more than a quarter consume none at all.
Among households dependent on temporary jobs, 93 percent reported eating protein less than once a week or not at all.
Dairy consumption was similarly scarce. According to the report, just 2 percent of children receive dairy daily, while half receive none at all, even in households with stable jobs.
No one thinks of breakfast in rural areas
Poor families lack both time and resources for breakfast, explained a civil activist in Khuzestan, southern Iran, who was not named in the Shargh report.
“These children do not eat breakfast, and the reason is the type of life they are accustomed to and the compulsion they face,” he said. Parents leave early for farm or livestock work, while children either help or care for siblings.
Another activist in Ilam province said: “Here no one thinks of breakfast anymore. Even if they do, they cannot afford it, and a child who has no proper nutrition during the day goes to school without breakfast."
In classrooms where children must engage both mind and body, “they have no fuel to burn,” he said, recalling repeated instances of students fainting during school line-ups.
A study published in the Journal of Health, Population and Nutrition in January, titled “The prevalence of malnutrition in children under 6 in Southern Iran from 2018 to 2023: a population-based study,” found that malnutrition remains a serious concern, particularly among children in rural provinces of Iran, where it has led to conditions such as stunting — impaired growth caused by chronic undernutrition.
