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Iran: What is the true inflation rate?

Some analysts put the inflation rate at more than 100 percent.

NCRI – On Wednesday, January 9, 2013 the Iranian regime’s Central Bank announced the annual inflation rate reached 27.4 percent at the end of 2012.  Even though the rate is one the highest ever published by the Central Bank, the figure grossly understates the real inflation rate.

According to independent economists, the figure provided by the Central Bank fails to fully account for a plunge in the value of county’s currency, the Rial, which lost more than 50 percent of its value against the dollar in the past year.

Steve H. Hanke, a Johns Hopkins University economics professor and senior fellow at the Cato Institute, Washington research group, who has been following Iran’s economy, said that the official inflation rate reflected what he called the Central Bank’s “habit of failing to release useful economic data, and what it does release often has what I would describe as an ‘Alice in Wonderland’ quality.”

“Ever since hyperinflation briefly reared its head, back in October, the Iranian government has tried to prop up its faltering currency and stop its economy’s death spiral through force and deception,”  Mr. Hanke wrote in an article titled “Iran’s Lying Inflation Statistics,” published in Cato Institute website.

According to the calculation that was done by using objective, market-based data Mr. Hanks believes the true rate of inflation is a whopping four times higher than the official reported rate.

According to Mr. Hanke’s calculations, Iran’s inflation rate last year was 110 percent.

The use of lying statistics is not a first for by Iranian regime which facing hyperinflation. It is a common practice by the Iranian regime to lie on the statistics.