Obama approves sanctions on Iran's currency, autos

USA TODAY

WASHINGTON — The Obama administration announced new sanctions on Iran Monday, targeting the country's currency and automobile industry, the latest effort to isolate Tehran from the global financial system.

An executive order by President Obama authorizes sanctions on foreign financial institutions that make transactions in Iran's currency, the rial, or keep accounts denominated in the rial outside the country.

The new rules, which go into effect July 1, penalize the sale of goods and services to Iran's auto industry, a key part of the country's economy.

"The steps taken today are part of President Obama's commitment to prevent Iran from acquiring a nuclear weapon, by raising the cost of Iran's defiance of the international community," White House spokesman Jay Carney said in a statement. "Even as we intensify our pressure on the Iranian government, we hold the door open to a diplomatic solution that allows Iran to rejoin the community of nations if they meet their obligations."

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The latest executive order is the ninth Obama has signed on Iran since the start of his presidency and the sixth in the last two years.

It marks the first time the White House has taken aim at Iran's currency. Administration officials aim to effectively make the rial unusable outside of Iran.

The value of the rial has fallen by more than half since the beginning of last year as Iran has endured mounting sanctions from the United States and international community. Previous sanctions targeting Iran's oil industry have resulted in the country's exports also falling dramatically.