Warnings from the regime’s own economists reveal an economy trapped between stagnation and hyperinflation, while ordinary Iranians bear the devastating cost of decades of mismanagement.
The most revealing assessments of the Iran regime’s economic crisis are no longer coming from independent analysts or international institutions—they are increasingly voiced by officials and economists within the regime itself. Their warnings paint a picture of an economy that has moved beyond chronic inflation and entered a far more dangerous phase, one that could culminate in hyperinflation.
The latest alarm was sounded by Masoud Nili, a prominent regime economist and faculty member at Sharif University of Technology, who warned that Iran’s economy has reached what he described as the “station before hyperinflation.” His remarks represent one of the starkest acknowledgments yet that the regime’s economic policies have pushed the country toward a potentially catastrophic financial collapse.
From Chronic Inflation to a Hyperinflation Risk
Speaking at the “Outlook for Iran’s Economy in 2026” conference on July 20, Nili argued that the regime’s economy has crossed the threshold separating chronic inflation from an era of exceptionally high inflation.
According to him, inflation is no longer simply persistent—it has become severe enough to threaten the stability of the entire economic system. He explained that while Iran experienced chronic double-digit inflation from 1973 until 2018, the country has since entered a fundamentally different stage characterized by sustained, exceptionally high inflation.
Such warnings are particularly significant because they come from an economist closely associated with the regime’s policymaking circles rather than from outside critics.
Economic Growth Has Ground to a Halt
Nili identified the collapse of economic growth as the first major indicator of the crisis.
He noted that, unlike the years following the Iran-Iraq war, economic growth has effectively stagnated since 2007. Combined with soaring inflation and persistent unemployment, the regime now faces deterioration across all three pillars of macroeconomic stability.
Recent official statistics reinforce his assessment. According to the Statistical Center of Iran, economic growth in 2025 was only 0.2 percent when oil revenues are included, while non-oil growth actually contracted by 0.3 percent.
These figures underscore the deep recession affecting the productive sectors of the economy. Many economists warn that if these trends continue, inflation could enter triple-digit territory—a hallmark of economies approaching hyperinflation, accompanied by a collapse in the national currency and widespread economic uncertainty.
The Central Bank Confirms the Crisis
Nili’s assessment was echoed by Abdolnasser Hemmati, the regime’s Central Bank governor, whose own remarks effectively confirmed the severity of the economic downturn.
Hemmati acknowledged that the regime’s economy is under intense pressure across nearly every major sector, including foreign trade, production, investment, government finances, and the banking system.
He pointed to declining oil exports resulting from sanctions and mounting restrictions, while revealing that gross fixed capital formation remained negative during the first three quarters of 2025, reaching negative 13 percent in the third quarter.
Perhaps even more striking was his admission regarding the dramatic erosion of living standards.
According to Hemmati, real per capita income—measured in constant 2021 prices—has fallen from approximately 141 million tomans in 2011 to just 75 million tomans in 2024. In practical terms, the purchasing power of the average Iranian has been cut nearly in half over just thirteen years, returning to levels last seen during the 1990s.
His remarks underscore that the crisis extends far beyond rising prices. The economy itself is producing less real wealth, meaning every citizen’s share of national income has steadily diminished.
Ordinary Iranians Have Reached Their Limit
The economic collapse is translating directly into growing social distress.
Only one month earlier, Mohammad Bathaei, head of the regime’s Social Affairs Organization, admitted that roughly 60 percent of Iranians can no longer endure additional economic pressure. Such an acknowledgment reflects the widening gap between official rhetoric and the daily reality experienced by millions struggling with soaring food prices, housing costs, and shrinking incomes.
Despite these admissions, senior regime officials continue to urge the population to accept further sacrifices.
Judiciary chief Gholamhossein Mohseni Ejei recently insisted that “standing against the enemy has costs, and we must accept those costs,” effectively asking citizens to shoulder the burden of policies over which they have no control.
A Crisis the Regime Can No Longer Conceal
What makes Nili’s warning particularly important is not simply his prediction of possible hyperinflation. Rather, it is the fact that one of the regime’s own leading economists has publicly acknowledged that the economy stands at the edge of an even deeper crisis.
Combined with Hemmati’s admissions about collapsing investment, economic stagnation, and the near-halving of real incomes, these statements amount to an extraordinary confession from within the regime itself.
For years, the Iran regime has attempted to portray its economic difficulties as temporary consequences of external pressures. Today, however, its own officials increasingly acknowledge a far harsher reality: an economy suffering from structural failure, decades of mismanagement, rampant corruption, and policy decisions that have steadily eroded national wealth.
As inflation accelerates, investment dries up, and household incomes continue to shrink, the regime faces more than an economic challenge. It confronts a profound crisis of governance—one in which the economic suffering of millions of Iranians has become impossible even for its own officials to deny.
