October 30, 2020
The Central Bank recently announced that its target rate for inflation this year was 22 percent, but the bank doesn’t stand a chance of getting it down that low.
Compared with the same month last year, inflation stood at a whopping 41.4 percent at the end of the eighth month of the Persian year on October 21. That was an astounding jump of seven percentage points since the previous month’s figure of 34.4 percent.
The Statistical Center of Iran also calculates the inflation rate as the average over the previous 12 months. By that calculation, inflation rose more modestly from 26.0 percent two months ago to 27.2 percent as of the end of last month.
Inflation is being driven now heavily by the veritable collapse of the rial, which is driving the cost of imported goods sky-high. The government is also trimming back the number of goods it allows to be imported with subsidized foreign exchange. A major item recently removed from that list is rice.
Inflation in the Islamic Republic has periodically risen above 40 percent and only rarely fallen below 10 percent.