Economy and Finance
Economic alarm bells ring in Tehran after the 12-day Israeli-Iranian war
Fresh off a costly war with Israel, Iran faces a worsening economic crisis marked by soaring inflation, a plunging rial, shrinking production, and a budget deficit exceeding $10.5 billion. The IMF now projects near-stagnant growth of just 0.3% in 2025, a sharp decline from earlier forecasts. Sanctions, corruption, smuggling, and collapsing oil revenues have left the regime scrambling to maintain services amid strikes, protests, and rising poverty. Observers warn that Tehran’s economic fragility—exposed by the war—could trigger deeper instability at home and weaken its ability to confront external threats.
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