The inflation rate for the 12 months to August stood at around 15.4%. Although this figure has dropped in comparison to the previous month, it is 3% higher than the inflation rate recorded for the previous Iranian calendar year (which ended on 20 March). The main reasons behind the rise in the inflation rate since the start of the year are:
1. the government’s budget deficit,
2. excessive withdrawals from the country’s Oil Stabilization Fund,
3. excessive obligatory loans provided by the banks and
4. the interest rate cut that was imposed on the state-owned as well as the privately-owned banks by the government.
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