Inflation has slowed for second month in a row

August 09, 2019

For the second month in a row, the annual rate of inflation has slowed but it remains at an eye-popping 48.0 percent, with the CIA monthly tabulation of inflation rates showing only two countries with higher inflation.

Those countries are South Sudan and Venezuela, which have such out of control rates of inflation that the CIA no longer even tries to publish a number.                     The highest other country for which the CIA published a rate is 41.5 percent in the Democratic Republic of the Congo.   And Angola and Sudan are the sole other countries showing inflation above 30 percent.

The Iranian rate is high and has been high for decades since the revolution.  Even when it drops below 10 percent—as it did briefly for a few months in 2010 and again in 2016 and 2017—it was only a hair below 10 percent and remained among the worst in the world.  According to the CIA tabulation this month, only 22 of 227 economies currently suffer inflation rates at 10 percent or above.

The 48.0 percent rate is the average for the past 12 months.  Another measure, comparing the rate with the same Persian month, Tir, which ended July 22, last year showed inflation at 40.4 percent.  That was an increase from the previous month and the highest rate ever for that measure.

But the 12-month average is the best number to use.  It tends to point in the direction that inflation will take, while the comparison with the same month of the previous year is late to reflect previous inflation.  In other words, the likelihood is that the inflation rate will now continue going down, though how quickly and how far cannot be forecast.

It should be noted that a number of Iranian publications are only publishing the lower inflation number, in an apparent effort to make the problem seem less forbidding to the public.