TEHRAN, Iran, August 10. The Iranian government's policies will solve the inflation rate growth in the short term, economic expert and Dean of Faculty of Economics at Kharazmi University Vahid Shaghaghi told Trend.
The elimination of the subsidized foreign exchange rate has led to an increase in the inflation rate by 12.2 percent from May 22 to June 21. According to the statistics issued by the Central Bank of Iran (CBI) inflation rate in this period was 54.6 percent.
Some of the reasons that cause inflation growth can be resolved in short term but some require long-term reforms while some have no relations with the economy and were resolved imposed from abroad, he noted.
Referring to the growth in inflation rate in the US and other countries, the economist indicated that the world is faced with a growing global inflation rate and a rise in food and energy prices. Iran is an importer of essential goods and naturally would encounter a high inflation rate.
Shaghaghi went on to say that the unstable economy, banking system, and budget deficit are other influential factors that need reform which is time-consuming.
The government's decision to increase labor salary by 57 percent has added to Iran's expenditures, he said adding that using low-interest rate loans and supportive packages could be used to reduce production costs.
Shaghaghi stressed that part of the growth in the inflation rate is because of the expected inflation rate that has steamed from the nuclear talks. The uncertainty in the economy and Iran's economic structures created more inflation and is rooted in a renter government that relies on oil.
According to the expert, controlling inflation needs structural reform and the possible revival of the Joint Comprehensive Plan of Action (JCPOA) might reduce prices