Iran's currency value further slumped against foreign currency in street market on Monday as one U.S. dollar was exchanged for about 20,500 rials compared to 18, 000 rials on Wednesday, the lowest ever value of Iranian rial.

The new slump in Iran's currency rate comes as European Union foreign ministers met in Brussels Monday to finalize further sanctions on Iran's oil exports and central bank.

Also, local semi-official Mehr news agency quoted market traders of foreign currency as saying that one U.S. dollar was exchanged for 20,500 rials on Monday and one Euro was exchanged for 26,000 rials in Tehran's street market.

Mehr said that the Iranian central bank is to announce the new rate of "one U.S. dollar for 14,200 rials," which aims at restoring stability in the market.

The Iranian currency came under heavy pressure earlier in January after the U.S. sanctions on Iran's central bank was announced.

Iranian rial has lost over 80 percent of its value against dollar in comparison to its trading value in December 2010, which stood at around 10,700 rials.

Iranian officials has threatened to close the strategic Strait of Hormuz if the West imposes sanctions on the country's oil. The Islamic republic heavily relies on its annual revenue on crude exports and its by-products.