The latest report from the Iranian Statistics Center reveals a troubling trend: the continued rise in inflation, particularly in food prices, is disproportionately impacting low-income households. November’s data highlights significant economic pressure, with rural communities bearing the brunt of the crisis.
Inflation Hits New Highs in November
According to the report, monthly inflation for food items surged to 3.6% in November—the highest rate recorded this year. Year-over-year inflation for food items reached 29.2%, with annual inflation climbing to 27.9%. These increases reflect the escalating cost of living across the country.
Rural areas, where food accounts for a larger portion of household expenses, are particularly hard-hit. In non-urban regions, point-to-point food inflation rose to 32.8%, surpassing the 30.9% recorded in urban areas. However, monthly inflation for food remains slightly higher in cities (3%) compared to rural areas (2.8%).
Challenges to Inflation Control
Despite the government’s efforts to stabilize prices, inflation remains stubbornly high. The Statistics Center has announced a marginal reduction in annual inflation rates for the fiscal year ending November 2024. However, both monthly and year-over-year figures continue to rise, casting doubt on the government’s ability to meet its goal of reducing inflation to below 30% by year’s end.
Economic experts accuse the Statistics Center of downplaying real inflation figures over the past three years. According to their analyses, food inflation exceeding 30% is rapidly eroding household purchasing power, shrinking food tables, and exacerbating economic hardships. Staples such as bread, dairy products, eggs, and protein sources have seen some of the steepest price increases.
Food Prices and Essential Goods
The government’s inability to control prices is evident, even for goods under price mandates. For instance, the cost of eggs has surged from 110,000 tomans to 150,000 tomans per box in recent weeks, despite assurances from the Ministry of Jihad Agriculture about sufficient livestock feed and market oversight.
A longer-term review underscores the deepening strain on household budgets. The price of a single egg rose from 1,300 tomans in 2021 to over 5,000 tomans in November 2024. Similarly, the price of pasteurized milk increased from 13,000 tomans in early 2021 to 40,000–45,000 tomans today—a staggering 265% inflation during the tenure of the 13th and 14th governments.
Declining Consumption Amid Economic Strain
As purchasing power erodes, many families are consuming less. Activists note that the apparent stability in the prices of meat, chicken, fish, and rice stems not from successful government policies but from a sharp drop in demand.
Per capita consumption of red meat has plummeted to just 700 grams per person annually, far below the regional average. In the dairy sector, consumption has fallen from 130 kg per person in 2010 to just 55 kg in 2024. These trends highlight the severe impact of inflation on the nutritional well-being of Iranian households.
Budget Policies and Future Risks
The recently unveiled 2025 budget raises additional concerns. A planned 130% increase in public spending suggests the government has no intention of addressing its bloated structure. This approach is likely to exacerbate the budget deficit, fueling even higher inflation in the years ahead.
Moreover, with the exchange rate hovering around 50,000 tomans—a 61% increase—the cost of imported goods is set to rise sharply, adding further strain to vulnerable groups. A planned 20% salary increase for workers and employees in next year’s budget will fail to close the widening gap between incomes and living expenses.
Currently, the minimum wage covers just eight days of a working family’s monthly expenses. To restore balance, wages would need to more than double—an implausible solution given the ongoing budget deficit and international sanctions.
Social Implications of Economic Pressure
Economic experts warn that prolonged inflation and declining purchasing power are pushing more families into poverty. Official statistics indicate that at least 30% of the population now lives below the absolute poverty line. This growing crisis threatens not only economic stability but also social and livelihood security, with far-reaching consequences for the country’s future.
The Iranian government faces mounting challenges in addressing inflation and ensuring basic economic security for its citizens. Without decisive action to control prices and improve incomes, the gap between the nation’s wealthiest and most vulnerable will continue to grow, deepening the country’s economic and social divides.
