Domestic Economy

Prerequisites for Curbing Inflation

In order to succeed in curbing inflation and reducing it to low and stable levels, as the first priority of economic policy for this year and the next, the government must adopt a policy of strict and lasting financial discipline
Prerequisites for Curbing Inflation
Prerequisites for Curbing Inflation

Iran's economy has been a frontrunner in registering chronic double-digit inflation in the world over the past four decades, which indicates that it is a structural problem in the country. 
In order to curb inflation, measures are needed to reduce and eventually eliminate structural factors that trigger inflation. Let’s remember that production growth is impossible without reducing inflation and stabilizing it at low levels. In the absence of inflation reduction over medium- and long-term perspectives, which are necessary for analyzing the justification of investment and realization of capital accumulation, are not possible, Hossein Bazmohammadi, a Central Bank of Iran advisor, prefaced an article for the Persian economic daily Donya-e-Eqtesad with this note. The translation of the full text follows:
High and unstable two-digit inflation makes the ad-hoc approach to investment to prevail and intensify speculative activities that have shorter returns. In the absence of capital formation, the infrastructure of production and employment weakens, giving rise to various economic, social and cultural problems. So, what are the main structural factors of inflation in Iran's economy? 


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