Page 14 - IRANRptNov18

4.2 Inflation 4.2.1 CPI dynamics
Iranian inflation officially reaches 13.5% but some top economists say it’s far, far higher
Iran’s annual inflation rate moved up to 13.5% y/y in the seventh month of the current Persian year (ended September 22) from 11.5% in the previous month, the Central Bank of Iran said on September 28.
The official figure massively conflicts with analyses by some internationally known economists who say that, given the collapse of the Iranian rial (IRR) in the face of renewed US sanctions imposed on Iran, Iranians are actually dealing with inflation running at around 250%.
On September 27, one of those economists, Professor Steve Hanke of Johns Hopkins University in the US, said in a tweet: “Iran needs to institute a gold-backed currency board or the value of the rial will continue to plummet. Tying the rial to a commodity is the only way to ensure the purchasing power of the rial and curb Iran’s runaway inflation.”
Food and household prices are, despite the government’s best efforts, increasing across the board as the costs of raw materials imported through the secondary and tertiary markets continue to rise in line with the nosediving IRR. Point-to-point CPI inflation stood at 31.4% y/y, marking a 6.1% increase month on month, the central bank said.
The central bank listed m/m figures as follows: food and beverages at 17.5%, tobacco 31.4%, clothing and footwear 9.8%, housing and utilities 9.5%, home furnishings 17.4%, health 10.4%, transport 15.9%, communications 10.7%, recreation and culture 23.5%, education 13.1% and restaurants and hotels 13.4%.
14 IRAN Country Report November 2018 www.intellinews.com