Iran’s battered rial has broken through the psychological barrier of 500,000 to the US dollar on Thursday after media reports of secret talks between Washington and Tehran.

The rial was trading at 492,000 to the US dollar in Tehran’s free currency market on Thursday for the first time since March 28. 

The dollar had risen to almost 560,000 rials on May 1 and then the Iranian currency began to rise steadily but remained in the 510,000 range throughout May. 

In the beginning of June, media reportsboth in Iran and abroad began amplifying rumors that the United States was secretly negotiating with Iran for some sort of a deal, that would at least involve the release of three US hostages in exchange for $7 billion of Tehran’s frozen funds in South Korea. 

Although there has been no official confirmation of any talks, Iran did free three European hostages last week, reinforcing speculations of a bigger agreement.

Iran’s currency has lost value 12-fold since early 2018 when the Trump administration withdrew from the 2015 JCPOA nuclear accord and imposed crippling sanctions on Iran’s oil exports and international banking. The currency devaluation was coupled with rising inflation that according to reports in May has reached to around 70 percent.

This has created a serious economic crisis in the country that was at least partly the driving force behind anti-regime nationwide protests last year and continuing political instability.

Some politicians and commentators in Iran have been calling on the regime to put aside its anti-West ideology and begin talks with the United States.