Iran’s inflation soars as household costs far exceed official figures

Fifteen key household items had increased in price by an average of 12% in just one month, a recent analysis by Iran International found, exposing a stark gap between official inflation figures and the reality faced by consumers.

Despite government statistics indicating a food inflation rate of 26.6% and an overall inflation rate of 32%, supermarket prices have risen far beyond these numbers, leaving many Iranians struggling to afford basic goods.

Supermarket prices have surged beyond what official reports indicate, leaving many citizens once considered middle class struggling to maintain their previous standard of living.

“We have stopped buying many things we used to consider normal, like nuts or even good quality rice,” said Mansour, 52, a resident of Tehran, who used to work in the banking sector but now finds his salary insufficient. “My children don’t understand why we’ve cut back so much.”

The economic crisis, which was once felt primarily by low-income families, has now engulfed middle-class households as well.

The Iranian rial has depreciated by more than 50% since September, falling to approximately 940,000 rials per US dollar. The collapse, combined with persistently high inflation—averaging around 40% annually over the past five years—has left many struggling to afford basic needs.

Official numbers versus market reality

Iran’s Ministry of Labor bases annual salary increases on official inflation figures, but market prices have consistently outpaced these statistics. A recent analysis by Iran International found that 15 key household items had increased in price by an average of 12% in just one month.

After cooking oil prices soared in December and potatoes became significantly more expensive in January, February has seen a sharp rise in the cost of legumes—some doubling in price within two weeks.

A survey of grocery prices in major cities, including Tehran, Mashhad, Isfahan, and Tabriz, found that household consumption costs had risen between 22% and 360% in the past week, with an average increase of 150%.

A 500-gram pack of tea, which cost 2 million rials ($2.13) last year, is now 4.6 million rials ($4.89).

Dairy products have also seen sharp increases. While official statistics report a 24% year-on-year inflation rate, market prices suggest much higher hikes.

A bucket of yogurt, which was 500,000 rials ($0.53) last year, now costs 760,000 rials ($0.81)—a 52% increase.

A 24-pack of toilet paper, once priced at 1.78 million rials ($1.89), now costs 3.93 million rials ($4.18), marking a 121% surge.

Families' statements about the price of various types of powdered milk also show that in February this year, the price of this essential product for infants has increased by 150 to 200 percent compared to the same time last year.

Rent and housing costs keep soaring

Inflation has also made housing less affordable. The Statistical Center of Iran reported a 37.6% increase in rent prices last month, but a nationwide survey by Iran International suggests that rents have risen by an average of nearly 78% over the past year. Many tenants have been forced to downsize or move to less expensive areas.

A resident of Tehran’s Yousef Abad neighborhood, who previously paid 240 million rials ($260) per month in rent, had to move to a smaller apartment due to rising costs. “I now pay 400 million rials ($430) a month for a place that is 10 square meters smaller,” he said.

While low-income citizens have long struggled with inflation, the economic crisis has now eroded the financial security of middle-class families. Many have reduced their spending on non-essential goods, and in some cases, even food quality has suffered.

With average monthly incomes now at just $120, while basic living costs exceed $500, over 30% of the population has fallen below the poverty line.