Page 20 - IRANRptNov19

4.2.2​ PPI dynamics
Iran’s PPI up 53.9% y/y in 10th month of Persian year
PMI for Iran falls into contraction territory
The SCI announced that its analyses showed that the current PPI rate in the country stood at 53.9% in the 10th Persian calendar month. That indicates that Iran is entering hyperinflation territory.
This is in comparison to just an increase of 15.2% y/y in the fifth month of the 2018/2019 Persian calendar year (ended August 22).
The rise in the PPI can be partly ascribed to the​ ​severe devaluation of the Iranian rial (IRR)​ ​seen in recent months, with producers raising their prices to compensate for the feed-through into inflation.
A purchasing managers’ index (PMI) provided by the Iran Chamber gives the Islamic Republic a reading of 45.79 in the fifth Persian calendar month (ended August 22) compared to 50.07 in the preceding month and 50.66 in the month before that.
With any figure below 50 indicating a contraction, the decline in the PMI figures can only be taken as another indication of the deleterious heavy sanctions campaign being waged against Iran by the US. Credit inside the country remains tight for lending, meanwhile, and the long hot summer in Iran is said to have hit demand across multiple sectors, impacting many factories.
Iran Chamber (full name Iran Chamber of Commerce, Industries, Mines and Agriculture) publishes PMI data for industry overall and 12 of its subfields. It has plans to expand its PMI coverage to sectors including agriculture at a later date.
During the fifth calendar month, plastic and rubber production in Iran posted the highest PMI registering 56.3. Wood, paper and furnishings posted the lowest score, at 35.9.
Looking at index components, output and new and contributed to the month-on-month decrease in the headline PMI figure, while suppliers' delivery times and employment scores improved.
The reading for exports in the fifth month fell from to 44.65 from 46.84.
4.3 ​Labour and income
4.3.1​ Labour market, unemployment dynamics
Unemployment rate stood at 12.4% in last fiscal year
According to the Statistical Centre of Iran (SCI), the country’s unemployment rate in the last fiscal year (ended March 20) stood at 12.4%, 1.4% up on the previous year. ​However, the actual unemployment rate is likely to be higher than that given methodology which means that if a person has just one hour of work a week officials count them as employed.
Youth unemployment (covering the 15-29 age range), ​stands at least twice the general joblessness rate,​ according to latest available data, while university graduate unemployment is thought to be around 40%.​ ​Despite the many times the government has stressed the need to boost employment, overall youth unemployment has risen more than 5% in the past three years.
20​ IRAN Country Report​ November 2019 www.intellinews.com