The Iranian currency, the toman, or rial, has lost half its value against the Iraqi dinar in recent weeks following U.S. and European sanctions, according to a report from Azzaman.
Iraqi traders welcomed the slump saying it has made the import of Iranian goods much cheaper than before.
In the holy cities of Najaf and Karbala, where demand for the Iranian currency is high, the dramatic depreciation in the Iranian currency was preventing some exchange bureaus from dealing in the toman.
The slump in the toman’s value was a shock and surprise to Iranian pilgrims who flock to Iraq in their tens of thousands every week; suddenly they found that they could not get the dinars they hoped for when exchanging their tomans.
Religious tourism, the backbone of the economies of Iraqi cities like Karbala, Najaf, Baghdad and Samarra, could be negatively affected.