Iran consumer prices remain stubbornly high despite rial recovery
Despite the Iranian national currency's comeback, consumer prices have yet to see commensurate drops due to price rigidity and uncertainty over the country's economic future.
Following months of turbulence this year, the Iranian rial has regained a significant portion of its lost value in the past several weeks. However, this trend has not been seen in consumer prices, leading to increasing public discontent.
The depreciation of the rial has led to sharp jumps in the prices of imported products, ranging from vehicles, audio-visual devices and cellphones to iron and aluminum. Given the import tariffs levied by the authorities, these kinds of products were already sold in Iran at prices often higher than the global average.
One example that could shed light on the situation is the iPhone. Since Apple has no official representative office in Iran, the US company's products — and iPhones in particular — are imported via China and Hong Kong, with the rial price set on the basis of the dollar rate.
That puts the price of an iPhone XS 64GB in Iranian markets at 150 million rials, or $1,187, whereas the rate in international markets is $999. The rate of the US dollar on the open market in Iran as of Dec. 23 was 103,000 rials. In other words, on the market rate the price of the popular device must stand at around a much lower rate of roughly 103 million rials, rather than 150 million.
