Iran's central bank says it is not hyperinflation. Economists are not convinced

Key Points:

• Abdolnasser Hemmati, governor of Iran's Central Bank, stated that the country's monetary crisis is under control and denied the occurrence of hyperinflation, while acknowledging rising prices and proposing a 23% increase in state food coupons.
• Economist Farshad Momeni argued that hyperinflation has already occurred in Iran, citing official and unofficial reports showing triple-digit inflation rates, especially impacting low-income groups and deprived provinces.
• The debate hinges on definitions: traditional economic criteria define hyperinflation as 50% monthly inflation, which Iran has not reached, but looser measures and regional data suggest severe inflation is present.
• Momeni warned that prolonged high inflation destabilizes contracts and social trust, fostering kleptocracy and economic misery, and criticized officials for being passive and insufficiently proactive in addressing the crisis.
• Hemmati highlighted severe constraints including halted oil exports, frozen foreign reserves, and reduced foreign currency allocations, while emphasizing government efforts to maintain basic goods supply and proposing financial cooperation among BRICS nations.