According to the president's official website, at a meeting on Wednesday chaired by President Hassan Rouhani, Cabinet members approved measures devised by CBI.
CBI Governor Valiollah Seif had announced earlier that foreign currency bonds would be issued for the first time in collaboration with the National Iranian Oil Company. CBI was due to announce more details about the package on Wednesday.
In a more heavy-handed approach, however, the government started a crackdown on currency hawkers blamed by officials for disrupting the market through their speculative practices, according to Financial Tribune.
According to local media reports, the police raided the hub of moneychangers around the British Embassy in Tehran and arrested 90 of them.
Tehran's Police Chief Brigadier General Hossein Rahimi told IRNA that 10 exchange offices had been shut and 16 others received warning.
According to IBENA, a news website affiliated with CBI, the crackdown included the freezing of the accounts of major currency traders totaling 200 trillion rials ($4.1 billion). This led to a temporary halting of trade and a general slowing of trade on Wednesday.
The measures also put a check on the forex rally that has seen rial depreciate by a quarter within six months ago. The rial was traded at 48,170 to the dollar on Wednesday after having crossed the psychological threshold of 49,000 the day before, according to Tehran Gold and Jewelry Union's website.
Iran's currency has collapsed from 38,400 to the dollar in July and has since hit record lows against the greenback.
The Rouhani administration, which had prided itself on a stable currency market throughout much of its first term, is now struggling to calm a foreign exchange market that has remained bullish for weeks.
Rouhani and his economic team have repeatedly sought to assure the public that the forex rally is temporary and warned speculators that their bet will backfire, but the market seems to have a head of its own.
Iran's nuclear deal with world powers, which lifted many international sanctions, had raised hopes the rial would regain its value lost in 2012 when western sanctions against Iran intensified.
Contributing Factors
Officials, including CBI chief, have lately attributed the rial's fall to efforts by US President Donald Trump to undermine the Iranian economy by creating uncertainty about the 2015 nuclear deal Iran reached with world powers, including Washington.
After Trump's arrival in White House, his threats to tear up the nuclear deal have scared off many foreign investors and prevented international banks from reengaging with Iran, accelerating the rial's fall.
Local analysts also point to the decision by the central bank to lower interest rates in September as another factor that made the foreign exchange market more appealing to investors.
Iranian banks have offered sky-high rates in recent years—often over 20%—but they now have to adapt to the new landscape as individuals and businesses prefer to keep their money in dollars or real estate.
With many banks dealing with a credit crunch, CBI decreed they could no long offer rates above 15%, which move traders say again pushed many back toward the dollar.
The central bank has also ramped up cooperation with the Iranian National Tax Administration to identify and levy taxes on major currency traders who, according to CBI, include just a handful of people.
Majlis Response
Also on Wednesday, Parliament Speaker Ali Larijani demanded a response from CBI chief for the current causes of rial's freefall and solutions to counter it after 90 MPs admonished the president about the issue.
He called on Majlis Economic Commission to follow up on the issue and come up with proposals to address it.
Mohammad Reza Pour-Ebrahimi, the head of the commission, said the current exchange rate is a "bubble" that has emerged from the mismanagement of the currency market, IBENA reported.
The gold market also experienced a cooler day with Bahar Azadi gold coin dropping 0.82%. According to TGJU, the benchmark coin fetched 15.77 million rials ($323) on Wednesday.