Iran’s inflation rate has climbed to 31.5% in the year to 20 March 2013 under the impact of international economic sanctions, according to official figures released by the government’s Statistics Office, Mehr News Agency reported on 1 April. The rate is up from 30.2% in the year to 20 February 2013 and 26.4% in the year ending on 20 March 2012. Iran has suffered from double digit inflation for over a decade, and since December 2010 the rate began to increase steeply as the government slashed food and fuel subsidies under the first phase of the targeted subsidies program. Since then the Iranian currency has weakened, adding further pressure on prices.
But many economists maintain that the real rate of inflation could be at least double the official rate, mainly because the government does not take into account the prices of many imported goods, which have become extremely expensive. Also economists are unsure about how the government calculates the rate of inflation, given the lack of transparency in the political system and contradictory statements by officials. In February the Governor of the Central Bank of Iran (CBI), Mahmoud Bahmani, warned that inflation would exceed the 30% mark in the new Iranian year as sanctions tightened. He attributed the spike in the inflation rate to a reduction in the supply of some products and the “psychological effect of concern about access to goods” (MEES, 4 March). The sanctions have restricted the export of Iranian crude oil and hit revenues, which could further exacerbate inflation.According to the head of a parliamentary committee, Gholamreza Mesbahi-Moqaddam, the budget for the year starting on 21 March envisages the export of 1.3mn b/d of crude, or half the 2.7mn b/d expected in last year’s budget. (CONTINUED - 281 WORDS)
