The alarm bell has sounded
The alarm bell has sounded. According to Iran Gate, more than 40 days into the year 1402, there is still no news on the release of inflation statistics for Esfand 1401 and the past Farvardin. Experts believe that this action by the government will not only fail to curb inflation but will worsen the situation.
The Statistical Center of Iran is responsible for publishing monthly and annual inflation statistics related to the past 30 days at the end of each month. Until 2018, the Central Bank also had this task on its agenda, but the government limited the release of inflation statistics to the authority of the Statistical Center. Ebrahim Raisi also accused the Rouhani government of censoring statistics, but now, 21 months into the thirteenth government, not only has the previous government’s action not been corrected, but the Statistical Center has also been cautioned against releasing statistics.
The problem is not just inflation
The policy of not releasing statistics by the government and the Central Bank is not limited to the inflation rate. Both the Statistical Center and the Central Bank have not published statistics related to the housing sector and average prices for four years. Moreover, many of the statistics and figures that were previously released have faced serious ambiguities from economists.
Reports have reached Iran Gate indicating that domestic media are under severe pressure from security agencies regarding the publication of the free market exchange rate. It is even said that a rate approximately 10% lower than the free market is being imposed on official media. In reality, security agencies are pressuring media to publish a rate that is about 10% lower than the actual currency price. Interestingly, this is not limited to the dollar rate but also includes the prices of the euro, pound, UAE dirham, and various gold coins.
Curbing inflation with concealment
Based on news from government advisors and signs from government behavior, it appears that officials believe they can solve problems, with inflation at the forefront, by not releasing statistics. The naming of the year 1402 with a focus on the keyword ‘curbing inflation’ has further encouraged government officials to prevent the release of inflation statistics.
The point is whether such actions can be effective and lead to controlling or curbing inflation. Economists believe this policy will not only fail to solve the issue but will exacerbate the crisis. It should be noted that in an inflationary economic environment, any news that fuels ambiguities can lead to more widespread inflation. Anything that increases the doubt of people and market participants about economic actions will intensify inflation.
More ambiguity means heightened inflation expectations
Economics experts believe that ambiguity inherently causes more market turmoil. Such turmoil increases blind movements of traders in various markets, known as inflation expectations. Therefore, not releasing inflation statistics intensifies ambiguity and leads to increased inflation expectations, which is entirely contrary to the slogan of curbing inflation.
On the other hand, the unprecedented increase in distrust towards the government in Iran has led people and public opinion to analyze any concealment within the framework of conspiracy theories. In simpler terms, people think that anything the government tries to hide means that destructive actions and conspiracies are being planned against the interests of ordinary people. The government’s track record in dealing with various crises also intensifies this public perception of similar issues.
It now seems that the issue of not releasing inflation rate statistics by relevant authorities has led people to believe that the inflation rate has significantly jumped and that the government wants to conceal this. These perceptions, which do not seem unlikely, are another factor in exacerbating real inflation, which is entirely contrary to the policy of curbing inflation. Therefore, it must be said that Ebrahim Raisi’s government has decided to stop fabricating statistics altogether and cease any publication of statistics to avoid being questioned or held accountable.
Rooting out the cancer of Iran’s economy: Why is inflation in Iran uncontrollable? Part Four
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