Page 14 - IRANRptJul19

Iran is facing a perfect storm involving a severe currency devaluation amid tightening sanctions levied by the US and stagnating wages. Many Iranians have cut down to essential purchases only, but prices have nevertheless continued to jump across the country. Rural areas are more heavily affected than urban localities.
Some international economists put Iran’s inflation rate a good deal higher than what is portrayed by the country’s official statisticians.
Iran’s economy is expected to shrink for a second consecutive year in 2019 while CPI inflation could hit 50% for the year, the International Monetary Fund (IMF) said in late April.
4.2.2 PPI dynamics
Iran’s PPI up 53.9% y/y in 10th month of Persian year
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.
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
14 IRAN Country Report July 2019 www.intellinews.com