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Inflation in Iran up to 16.7%

Inflation in Iran continued its upward trend for the second consecutive year, rising to 16.7 percent in a year to 'Mordad,' the fifth month in Iranian calendar, with manufactured goods and foodstuff becoming costlier, IRNA reported from Tehran.

Reflecting the increased cost of living, the general price line, measured by the Wholesale Price Index (WPI), rose by 0.2 percent to 234.6 points in urban areas in Mordad as prices of primary articles and fuels continued their upward trend compared to those in the corresponding month the previous year.

The final WPI rose by 0.7 percent in Mordad, excluding the fluctuating seasonal figures. The final point-to-point inflation for Tehran was reportedly pegged at 0.7 percent.

The province of Lorestan ranked first in the list with the inflation rate of 0.7 percent in the year under study.

In Iran, Inflation is mainly caused by banking mismanagement, staggering loan and borrowing, mostly by the state organizations, government's domination of key economic sectors, indiscriminate allocation of subsidy both to the poor and the rich, and the government's expansionary policies.

The fixed income group, which includes employees and workers, suffer the most from inflation.

The government has been trying to follow deflationary policies, including raising taxes, issuing participation bonds, and revising banking policies.

... Payvand News - 9/21/03 ... --

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