In a new report on March 19, the Statistical Center of Iran (SCI) announced the inflation rate in the 12-month period ending March 20 at 34.8 percent. In January the Center had reported a 12- month period inflation rate of 38.6, nearly four points higher.
According to the report, the inflation rate for foodstuff and drinks stood at 43 percent. Meanwhile, the data shows inflation in rural areas has been much higher than in cities. Rural and urban inflation were 37.3 and 34.4 percent, respectively.
Since March 2019, when the Central Bank and other government offices stopped issuing economic reports, the Statistical Center of Iran is the only entity issuing sporadic economic reports.
In August 2018, the single-digit inflation rate in Iran began to grow and reached a record high of 42.7 in September 2019. Iran's statistical center claims that inflation has been slowing since then.
According to the World Bank Iran's GDP fell 8.7 percent in 2019 compared with 2018, which in turn was 4.9 percent lower than the previous year.
The U.S. decision in May 2018 to pull out of the Iran nuclear agreement and reimpose sanctions soured Iran's economy and led to a steep devaluation of its currency, bringing high inflation, lack of investments and high unemployment. Since February 19 that the coronavirus epidemic broke out, Iran's currency has lost more value.
Oil sanctions particularly were a hard blow for Iran, which has a weak economy mostly dependent on oil revenues.
The World Bank forecasts zero gross domestic production (GDP) growth for Iran in 2020 and one percent growth in 2021. The International Monetary Fund estimate of contraction in Iran's GDP for 2019 was even more worrisome at 9.5 percent. However, given the continuation of U.S. sanctions, devaluation of the Iranian currency and the coronavirus epidemic that has hit the Iranian economy very hard, the forecast is very likely to be too optimistic now.
In a tweet on March 12 Foreign Minister Mohammad Javad Zarif said Iran's Central Bank has requested immediate access to funding from the International Monetary Fund for countries affected by coronavirus. This is for the first time since 1962 that Iran has asked for a loan.