Page 19 - IRANRptAug22

Iran’s industrial production decreased 1.6% y/y in the third quarter of 2021, compared to a rise of 9.1% and 5.8 y/y in the first and second quarters of 2021, respectively.
4.2 Inflation
4.2.1 CPI dynamics
Academic attempts to explain Iran’s record inflation
Iran’s wheat subsidy cut triggers dramatic flour price rise ‘that could spark social unrest’
Iran’s official annual inflation rose 13.2 pp to 52.5% in June from 39.3% in May, the Statistics Center of Iran (SCI) announced on June 28.
“An average Iranian family lost 10% of its shopping power within this 30-day period,” noted Ali Dadpay, an associate professor of finance at Gupta College of Business, University of Dallas, writing for Al-Monitor. “Iranian consumers are paying 50% more for the same products compared to spring 2021. The loss of real income and purchasing power for many Iranian families is significant and irreversible.”
Seeking to explain the record inflation, the academic said it was “not the new government policy in the currency market that has increased the prices”.“
As always,” he added, “inflation remains a monetary issue. The Iranian government has been increasing the money supply to compensate for the loss of oil revenues and economic activities. The Raisi administration claims it has solved a budget deficit of 4,800 trillion IRR (the equivalent of 17.5 billion USD) without borrowing from the Central Bank of Iran (CBI) or increasing the money supply. However, the CBI has not yet published its monetary data for the winter of 2022.
The blow to Iranian consumers came a day after Iranian oil and petrochemical workers began a strike for higher wages, with their industries becoming the latest of several in Iran to be plunged into turmoil by cost-of-living protests. Teachers, stone factory workers, public employees, taxi drivers and bus drivers are among groups that have lately taken to the streets protesting at poor pay and work conditions, while there have also been substantial protests at low pensions mounted by pensioners across the country.
The Coordinating Council of Protests of Oil Contract Workers was reported by Radio Farda as saying that employees at the Tehran Oil Refinery were continuing their protest against an increase in working hours and low wages, while drivers and workers at the West Oil and Gas Exploitation Company gathered at the company's location in the western city of Dehloran saying they
19 IRAN Country Report August 2022 www.intellinews.com