The Iranian rial has fallen to a new all-time low against the US dollar, dropping past 2 million rials to $1 on the free market after Washington launched its toughest sanctions yet in efforts to strangle Tehran’s economy. Iran’s economy has been crippled by decades of US and international sanctions, especially over its nuclear programme – the Iranian rial has crashed and inflation woes are piling up misery for people. The US-Israel war on Iran, launched on February 28, worsened the economic woes for the country of some 92 million people.
To understand how much everyday items now cost, Al Jazeera tracked the prices of food, clothing and medicines on the streets of Tehran, comparing them with what the same goods cost in the days before the war. Before the war, 2 million rials could buy about 4kg of tomatoes, half a kilo of chicken and a little less than a litre of cooking oil. Today, the same amount buys about half as much, with the average price of tomatoes increasing by 71 percent, chicken by 74 percent and cooking oil by 177 percent.
The price of insulin, the baseline survival for diabetics, has shot up by 642 percent, while essential medicine like paracetamol has become dearer by 93 percent, and baby formula, largely subsidised by the government, has become costlier by 95 percent. The graphic below breaks down the average costs of food, clothing and medicine before the war and on Wednesday. Prices remain highly volatile, and the figures reflect average values.
For Iranian families, this has meant changing not only how much they buy, but also what they eat. Afsaneh*, a 35-year-old mother of a one-year-old who lives with her husband in Tehran, says her family’s weekly grocery bill has increased by 20 to 30 percent. The daily cost of childcare at daycare centres has now reached around 500,000 tomans [5 million rials or $2.5], which is difficult for us to afford.” Toman is the term Iranians use for the rial as an unofficial unit equal to 10 Iranian rials, widely used because it makes the country’s large currency figures easier to manage.
The government subsidy on baby formula helps families like Afsaneh’s, but their monthly wellness checkups and nutritional supplements are not covered by insurance, making it difficult to afford quality care for their infant. For Afsaneh, their small family is limited to survival and covering food and other necessities. And I don’t think things are going to get better anytime soon,” she said.
War damage has disrupted production, while a US naval blockade of Iranian ports has complicated imports and exports. While the falling rial has pushed up the cost of goods, sanctions have restricted Iran’s access to international markets. At the same time, wages have failed to keep pace.
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