Iran's inflation tops 27%

INFLATION SURGE: An Iranian vendor serves a customer in Tehran. Iran's inflation hit 27.6 percent in the calendar month of Mordad. (AFP)

Iran's inflation hit 27.6 percent in the calendar month of Mordad that ended August 21, the central bank said Sunday, as Iranians were again battered by rising prices of basic foodstuffs and goods.

The consumer price index (CPI) in urban areas increased by 27.6 percent compared to the same month in the previous year, the Etemad newspaper quoted the bank as saying.

The figures confirm that prices are on an upward trajectory in the nation of 70 million people, with the poor hit the hardest.

Inflation in urban areas for the Iranian month of Tir which ended July 21 touched 26.1 percent, while the two months prior to that registered CPI increases of 25 and 24 percent respectively.

The central bank report only provided the figure for urban areas, where more than two-thirds of the Iranian population live.

President Mahmoud Ahmadinejad has been blamed by many economists for directly fuelling the price rises by ploughing huge amounts of cash into the economy to fund local infrastructure projects.

The inflation mostly affect staples such as meat, beans and rice whose prices have doubled in a yearly comparison. Milk and bread, if unsubsidised, have also joined the inflation-hit items.

A four-member family with the lowest labour income of 2,100,000 rials (around 215 dollars) has to spend up to 80 percent of its income on food each month, Etemad newspaper said.

Based on the central bank figures, the daily concluded that food spendings for such a family have been doubled in one year, from 870,000 rials (90 dollars) to 1,830,000 rials (188 dollars).

Ahmadinejad was elected in 2005 on a platform of making the poor feel the benefits of the OPEC member's massive oil wealth, and he has made implementation of economic "justice" the main government slogan.

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