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TEHRAN, Iran (AP) ? Iran said Tuesday that the steep depreciation in the country's currency against the U.S. dollar was not linked to U.S. new sanctions targeting its Central Bank, while officials geared up for a meeting to assess possible measures to shore up the riyal in an already ailing economy.
Since President Barack Obama on Saturday signed into law a bill that takes aim at Iran's Central Bank, the riyal hit a new record low on Monday, dropping by around 13 percent against the dollar in just two days and reaching 18,000 riyals to the dollar. The official rate, which few but the government pay attention to, is 11,180 riyals to the dollar. The currency rebounded Tuesday to about 17,000 riyals to the dollar.
The pressure on the riyal has become the latest economic blow to the country's economy, which is under several rounds of U.S., United Nations and European Union sanctions because of its controversial nuclear program. Critics have argued that President Mahmoud Ahmadinejad's stewardship of the economy has brought few gains.
The decline in the currency's value "is not related to the sanctions," Foreign Ministry spokesman Ramin Mehmanparast, arguing that the sanctions had yet to take effect. "For the time being, it has nothing to do with foreign policy."
The semiofficial Mehr news agency reported Monday that the Central Bank was planning on holding a meeting of experts to discuss the volatility in the currency markets. The meeting was slated for Wednesday.
The latest sanctions signed by Obama include an amendment barring foreign financial institutions that do business with Iran's Central Bank from opening or maintaining correspondent operations in the United States. The Obama administration, however, is looking to soften the impact of the measure, fearing they could lead to a spike in global crude oil prices or pressure key allies that import Iranian oil.
The measures add new pressure to a hardline government that has already come under tremendous pressure from the U.S. and its allies over a nuclear program the West maintains is aimed at developing weapons. Iran says its program is purely peaceful.
The standoff prompted threats last week by Iran to shutter the Strait of Hormuz, a waterway through which a sixth of the world's oil moves to market.
While few believe that Iran would actually take the step, the warnings appear to reflect Iranian officials' unease with the sanctions regime and the effect they are having on the country. Iran relies on oil exports for about 80 percent of its annual foreign revenue, and sanctions targeting its oil, or even a unilateral move by Tehran to withhold its crude from the market ,would deprive government coffers of sorely-needed cash.
Amid the international political tussle, the economic situation in the country grows increasingly less palatable for Iranians.
The official inflation rate remains at more than 19 percent, while analysts argue it is significantly higher than that level. Subsidy cuts on food and energy that were pushed through Parliament last year by Ahmadinejad are very unpopular, and economists warned long before they were enacted that they could further stoke inflation. Since the cuts were implemented, food and energy prices have spiked.
While Iranian economists, for now, argue that the latest sanctions may not be directly influencing the currency, the new measures add to already existing angst in the country.
Banking analyst Farid Ziaolmaleki, in comments echoed by others, believes that more Iranians are turning to the currency speculation, buying up dollars, as inflation has outpaced the 12 to 15 percent interest rates offered by banks.
Compounding the pressure on the riyal that such speculation could have, merchants have also taken to calculating the price of their wares in dollars, hoping for a steeper depreciation in the Iranian currency.
Economic daily Donya-e-Eqtesad wrote in its Tuesday edition that "a big portion of merchants are not willing to sell their wares, and prefer to hold onto them until" the dollar strengthens more against the riyal.
Another daily newspaper, Shargh, said that housing prices had increased by 25 percent in recent weeks because of the weakening in the value of the riyal.
Even as Iranian officials argue the current currency pressure have little to do with the latest sanctions, other note that the threat last week to choke off the Strait of Hormuz was a factor.
The warnings "cause reactions, and this was reflected on the currency," said Vahid Mahmoudi, a Tehran University professor of management.
___
El-Tablawy reported from Cairo.
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McDONALD, Ohio?? Authorities say a minor earthquake hit in northeast Ohio.
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The U.S. Geological Survey says the 4.0 magnitude quake struck Saturday afternoon in McDonald, outside of Youngstown.
There were no immediate reports of damage. One witness about 20 miles from the epicenter says she saw the ornaments shake on her Christmas tree. Others say it was strong enough to panic pets and send relatives running for cover.
It was the latest in a series of minor quakes in the area in 2011, though residents say Saturday's appeared to be stronger than others. Many have struck near an injection well used to dispose of brine water that's a byproduct of oil and gas drilling.
Its owner agreed this week to stop injecting brine into the earth while the quakes are investigated.
Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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Revelers cheer behind police barricades in Times Square in anticipation of midnight on New Years Eve, Saturday, Dec. 31, 2011, in New York. Some revelers, wearing party hats and "2012" glasses, began camping out Saturday morning, as workers readied bags stuffed with hundreds of balloons and technicians put colored filters on klieg lights. (AP Photo/John Minchillo)
Revelers cheer behind police barricades in Times Square in anticipation of midnight on New Years Eve, Saturday, Dec. 31, 2011, in New York. Some revelers, wearing party hats and "2012" glasses, began camping out Saturday morning, as workers readied bags stuffed with hundreds of balloons and technicians put colored filters on klieg lights. (AP Photo/John Minchillo)
Jessica Ong from Singapore starts her new year celebrations early on New Year's Eve, at the Hogmanay street party on Princes Street, Edinburgh, Scotland, Saturday Dec. 31, 2011. (AP Photo / David Cheskin/PA) UNITED KINGDOM OUT
Fireworks explode over the Houses of Parliament, including St Stephen's Tower which holds the bell known as Big Ben as London celebrates the arrival of New Years Day Sunday, Jan. 1, 2012. (AP Photo/Alastair Grant)
Ally Savage, left, of Pittsburgh, Pa., and Michael Carajohn, of New York City, share a new year's eve kiss in front of an illuminated U.S. flag during the new year's eve celebration at Times Square, Saturday, Dec. 31, 2011, in New York. (AP Photo/Julio Cortez)
Revelers are showered in confetti in Times Square in anticipation of midnight on New Years Eve, Saturday, Dec. 31, 2011, in New York. Some revelers, wearing party hats and "2012" glasses, began camping out Saturday morning, as workers readied bags stuffed with hundreds of balloons and technicians put colored filters on klieg lights. (AP Photo/John Minchillo)
NEW YORK (AP) ? Revelers erupted in cheers amid a confetti-filled celebration in New York's Times Square to welcome in the new year, part of star-studded celebrations and glittering fireworks displays around the world to usher in 2012.
From New Zealand to New York, the world eagerly welcomed a new year Sunday and hoped for a better future, saying goodbye to a year of hurricanes, tsunamis and economic turmoil that many would rather forget.
In New York, hundreds of thousands gathered at the crossroads of the world to witness a crystal ball with more than 30,000 lights descended at midnight. Lady Gaga and Mayor Michael Bloomberg led the crowd in the final-minute countdown of the famed crystal-paneled ball drop.
Revelers in Australia, Asia, Europe and the South Pacific island nation of Samoa, which jumped across the international dateline to be first to celebrate, welcomed 2012 with booming pyrotechnic displays. Fireworks soared and sparked over Moscow's Red Square, crowds on Paris' Champs-Elysees boulevard popped Champagne corks at midnight.
But many approached the new year with more relief than joy, as people battered by weather disasters, joblessness and economic uncertainty hoped the stroke of midnight would change their fortunes.
"It was a pretty tough year, but God was looking after us and I know 2012 has got to be better," said Kyralee Scott, 16, of New Jersey, whose father spent most of the year out of work.
Some New York revelers, wearing party hats and "2012" glasses, began camping out Saturday morning, even as workers readied bags stuffed with hundreds of balloons and technicians put colored filters on klieg lights. The crowds cheered as workers lit the crystal-paneled ball that dropped at midnight Saturday 400 feet (120 meters) above the street. The sphere, now decorated with 3,000 Waterford crystal triangles, has been dropping to mark the new year since 1907, long before television made it a U.S. tradition.
The first worldwide celebrations started in the island nation of Samoa, which hopped across the international date line at midnight on Thursday, skipping Friday and moving instantly to Saturday.
Samoa and the neighboring nation of Tokelau lie near the dateline that zigzags vertically through the Pacific Ocean; both sets of islands decided to realign themselves this year from the Americas side of the line to the Asia side to be more in tune with key trading partners.
In Sydney, more than 1.5 million people watched the shimmering pyrotechnic display designed around the theme "Time to Dream." In London, some 250,000 people gathered to listen to Big Ben chime at the stroke of midnight.
World leaders evoked 2011's struggles in their New Year's messages with some ambivalence.
French President Nicolas Sarkozy warned Europe's crisis is not finished and "that 2012 will be the year full of risks, but also of possibilities."
Pope Benedict XVI marked the end of 2011 with prayers of thanks and said humanity awaits the new year with apprehension but also with hope for a better future.
"We prepare to cross the threshold of 2012, remembering that the Lord watches over us and takes care of us," Benedict said. "In him this evening we want to entrust the entire world. We put into his hands the tragedies of this world of ours, and we also offer him the hopes for a better future."
In Brazil, heavy rains didn't halt parties as upward of 2 million people gathered on Copacabana beach in Rio de Janeiro and nearly as many on a main avenue in Sao Paulo, South America's biggest city. Massive fireworks displays and top music acts graced stages across the nation.
Brazil has seen healthy economic growth in recent years, as the country prepares to host the World Cup in 2014 and the Olympics in 2016. Growth, however, has stalled in recent months, and Brazilian leaders are trying to stimulate the economy in the new year.
"This was a good year for Brazil and I think things are only getting better, it feels like we're making big advances," said Fabiana dos Santos Silva, an 18-year-old student who gathered with hundreds of thousands of others on a main avenue in Sao Paulo.
In Times Square, hundreds of thousands of people were crammed into spectator pens ringed by barricades, enjoying surprisingly warm weather for the Northeast this time of year. The National Weather Service said Saturday it was about 49 degrees Fahrenheit in nearby Central Park. That's about 10 degrees warmer than the normal high temperature this time of year.
Many expressed cautious hope that better times were ahead after a year in which Japan was ravaged by an earthquake and tsunami, hurricanes wreaked havoc across the country and a debt crisis devastated Europe's economy.
"Everybody's suffering. That's why it's so beautiful to be here celebrating something with everybody," said Lisa Nicol, 47, of Melbourne, Australia.
For all of the holiday's bittersweet potential, New York City always treats it like a big party ? albeit one that now takes place under the watchful eye of a massive security force, including more than 1,500 police officers.
In Las Vegas, police shut down a 4-mile (6.4-kilometer) section of the Strip to vehicle traffic six hours before midnight, letting revelers party in the street. Casino nightclubs touted pricey, exclusive bashes hosted by celebrities including Kim Kardashian and Fergie, and fireworks were expected to shoot from the rooftops of eight of the city's most famous casinos.
Atlanta welcomed thousands to its downtown, where a giant peach is dropped every New Year's Eve at midnight. Fireworks were to be launched from the top of the Space Needle in Seattle; in Houston, tens of thousands were celebrating at a party with country singer Delbert McClinton.
In summer temperatures at Key West, Florida, three separate midnight drops were planned. A giant facsimile of a conch shell was lowered at Sloppy Joe's Bar, Ernest Hemingway's favorite watering hole when he lived in Key West. At the Schooner Wharf Bar, the bar owner dressed as a pirate wench was to drop down from a mast of a tall sailing ship. And at the Bourbon Street Pub complex, a drag queen named Sushi was to descend in a glittering 6-foot (1.83-meter) red women's high heel.
In San Francisco, revelers were lining the waterfront for the annual fireworks show. Though the city's fickle weather and persistent fog can never be counted on to cooperate, forecasters say the skies above the city should be clear overnight.
Several people preparing to celebrate the holiday in the U.S. told the AP that they would usher in the New Year hoping the Congress would become a more cooperative place. Some talked about their hopes for the presidential election. Others said they hoped to hold on to their job, or find a new one to replace one they'd lost.
An Associated Press-GfK poll conducted Dec. 8-12 found that 62 percent of Americans are optimistic that the nation's fortunes will improve in 2012, and 78 percent hopeful that their own family will have a better year. Most wrote off 2011 as a dud.
___
Contributing to this report were Associated Press writers Chris Hawley and David B. Caruso in New York, Oskar Garcia in Las Vegas, Bruce Shipkowski in Jackson, New Jersey, Dorie Turner in Atlanta, Greg Keller in Paris, Harold Heckle in Madrid, Kristen Gelineau in Sydney, Ray Lilley in Wellington, New Zealand, Frances D'Emilio in Vatican City, Meera Selva in London, Bradley Brooks in Sao Paulo, Brazil, Jack Chang in Mexico City and Melissa Eddy in Berlin.
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