Think-Tank Predicts Double Digit Inflation

Point-to-point inflation will again jump to double digits before the current  fiscal year is out (March 2017) but is no cause for concern, says the research director of the Monetary and Banking Research Institute.

“With the implementation of the nuclear accord and changes that came to pass as a result, businesses went in the direction of transferring their deposits from near money to money,” banker.ir quotes Hamid Zamanzadeh as saying.

“Now investors and consumers alike are mostly looking to pull their assets from banks.”

These changes, he notes, were the reason behind the increase in the volume of broad money supply from late last year and the increase went so far that in the summer, the rate of money supply  increase was higher than the rate for near money.

Zamanzadeh said the fact that the rate at which liquidity has grown has outpaced the rate of increase for quasi-money is a tell-tale signal that point-to-point inflation will soon rise.

“It is predicted that by the end of the year, inflation rate will rise to double digits from the current single digit.  

But this is no cause for concern because it will be temporary and considering the long-term and mid-term policies of the Central Bank of Iran, the inflation rate will once again drop to single digits.”