Tough U.S. sanctions on Iran come into force

U.S. President Barack Obama has signed into law tough new sanctions targeting Iran's central bank and financial sector, in a move likely to deepen acrimony between Washington and Tehran.

The sanctions require foreign firms to make a choice between doing business with Tehran's oil and financial sectors or central bank or the mighty U.S. economy and financial sector.

Foreign central banks which deal with the Iranian central bank on oil transactions could also face similar restrictions under the new law, which has sparked fears of damage to U.S. ties with nations like Russia and China which trade with Iran. The move raised concerns that sanctions on Iran's bank could spark chaos in global financial system and hike oil price.Mr. Obama said in a statement he was concerned the measure would interfere with his constitutional authority to conduct foreign relations by tying his hands in dealings with foreign governments.