A UN nuclear agency report that Iran has boosted its uranium enrichment capacity led to a renewed a call in the US Congress for tighter sanctions on Iran.

The International Atomic Energy Agency's quarterly report said Iran has installed about 1,000 advanced uranium enrichment centrifuges and is set to test them.

The report is the IAEA's first since the relatively moderate Hassan Rouhani won Iran's June presidential election.

Legislation that would tighten sanctions on Iran over its nuclear programme has been making its way through the US Congress this year.

The House of Representatives passed a bill on harsher sanctions in late July that seeks to push Iran's oil exports down another 1 million barrels per day in a year.

The Senate Banking Committee is expected to pass its version of a tougher sanctions bill in September, although it is unclear whether the 1 million bpd goal would be included.

Western powers say Iran's nuclear programme is enriching uranium that could be used to fuel a nuclear weapon.

Iran insists that it is for peaceful purposes, including power generation and medical devices.

US and EU sanctions have had a deepening impact on Iran's economy in the past year-and-a-half as they slashed oil imports, the country's main source of income.

The measures already have cut Iran's oil exports by more than half compared to pre-sanctions levels of about 2.2 million bpd, helping to devalue Iran's currency and contributing to a steep rise in inflation.