Macroeconomic Forecast Iran

BMI View: The continuation of the subsidy reform programme, which began in December 2010, will result in sustained high inflation over the coming quarters. While the January consumer price inflation print came in at 15.8% year-on-year (y-o-y), markedly above the December figure of 12.8%, producer price inflation for the month was 29.3%, more than double the December print of 12.7%. We expect consumer price inflation to accelerate more rapidly than producer price inflation, and we reiterate our average FY2011/2012 consumer and producer price inflation forecasts of 25.0% and 20.0% respectively.

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