Baku, Azerbaijan, Apr. 21
By Emil Ilgar – Trend:
The inflation rate in a year to Iran’s first fiscal month, started March 21, reached 6.9 percent, the statistical Center of Iran announced Apr.21.
According to the report, the point-to-point inflation rate (First month of the current fiscal year against the same month in the last fiscal year) also stood at 9.4 percent.
Iran’s inflation rate was above 40 percent when President Hassan Rouhani took office in mid-2013.
World Bank also said in a report on Apr.20 that inflation appears to be stabilizing at around 10 percent after a declining trend over the past three years.
WB added that this signals that the output gap is closing.
The CBI (Central Bank of Iran) has actively pursued tight controls on keeping the nominal exchange rate stable and re-sisted depreciation primarily relying on oil-based foreign exchange reserves, according to WB.
“As a result, the real exchange rate has appreciated, which undermines the competitiveness of non-oil exports. By allowing a higher number of transactions to take place at the market rate, the government managed to reduce the gap between the official and market exchange rates from 112 percent in 2012 to 14 percent in September 2016 – which more recently increased to 20 percent in December. Yet, the planned unification of the two rates is delayed to next fiscal year,” the report said.
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