The official inflation rate in 1400 was announced as over 40 percent; the third highest inflation rate in the history of the Islamic Republic.
The Statistical Center of Iran says that the annual inflation rate reached 40.2 percent in Esfand 1400.
This is the third time in the history of the Islamic Republic that the annual inflation rate has been recorded above 40 percent in the country. Previously, the inflation rate had reached above 40 percent in 1974 and 2019.
The inflation rate for 2020 was announced to be around 36.4 percent.
The announcement of inflation rates by the statistical agencies of the Islamic Republic of Iran has always been met with skepticism by independent experts and economists, who always point out that the real inflation rate is higher than the official statistics.
The details of the Statistics Center's report show that food prices increased by nearly 52% in the first 12 months of last year compared to the same period in 2020, but other items, such as services and housing, grew less.
However, the report says that housing prices and rents increased by only 27% in March of last year compared to the same month in 2020, while Central Bank statistics and domestic media research show that housing prices and rents in Tehran are at least twice the figures claimed by the Statistics Center.
The details of the Statistics Center report also show that price growth was higher in rural areas than in urban areas.
Inflation has soared to over 40 percent, while in the past solar year, both the volume of exported oil and its price almost doubled, and the country's non-oil exports also witnessed a growth of over 40 percent.
Despite the multiplication of foreign exchange earnings, the average dollar price in Iran's free market during 1402 was about 26,000 Tomans, which is 13% more than in 1399.
On the other hand, since April 2018, when the preferential foreign exchange allocation of 4,200 Tomans was implemented for the import of essential goods, about $71 billion in government foreign exchange has been delivered to importers of goods. Despite this amount of government foreign exchange allocation, the price index has risen from below 113 in April 2018 to above 401 in March last year.
Such a large jump in the price index comes at a time when the government is trying to stop allocating 4,200 tomans for basic goods this solar year, an issue that will lead to accelerated inflation.
In this context, the IRNA news agency published a report on March 17, stating that the effect of the 4,200-toman currency on reducing inflation was "minor" and that the preferential currency had led to corruption and rent-seeking.
The government does not explain why, instead of fighting corruption and rent, it sees the solution to the issue as eliminating the 4,200-toman currency and how it intends to control its inflationary consequences; however, some government officials had previously announced that instead of the 4,200-toman currency, household subsidies would increase.
Increasing subsidies is itself a factor in increasing liquidity and further accelerating the inflation rate, and on the other hand, a decline in the value of the rial.
Liquidity in Iran has soared from about 1,537 trillion tomans to 4,501 trillion tomans from the beginning of 2018 to January of last year, when the latest Central Bank statistics were published; in other words, it has tripled in less than four years.
Such a rate of liquidity growth has fueled rampant inflation in the country.
Over the past four years, the dollar exchange rate has soared from below 5,000 tomans to above 26,000 tomans, and even exceeded 30,000 tomans at times. Overall, the Iranian rial has lost 80 percent of its value during this period.
Source: Radio Farda
