Defense News and Headlines

Iran Can Still Normalize Its Economy—But the Path Will Be Painful and Slow

Iran’s inflation, hovering around 20% and spiking above 40% during sanctions, has become a structural feature of its macro‑economy. The country’s fragmented exchange‑rate system, fiscal deficits financed by the central bank, and dominant state‑linked enterprises perpetuate price pressures. Analysts argue that normalizing the economy requires unifying exchange rates, ending monetary financing, and redefining the state’s role, even if the transition is politically painful. Technical cooperation with the IMF and World Bank could guide reforms, but delays risk deeper dollarization and economic decay.