U.S. President Donald Trump claimed Iran’s economy is collapsing, but Mehrdad Sepahvand, a former economic adviser to Iran’s Central Bank, offered a more nuanced assessment. According to the World Bank, Iran’s GDP contracted by 2.7% in the year ending March, with inflation reaching 62.2% in February and food price inflation at 99%. The United Arab Emirates’ decision to halt all trade and financial ties with Iran, its largest source of imports, could deepen the contraction to approximately -5% this year. Sepahvand noted that shops remain stocked and no bank runs have occurred, while acknowledging that economic pressure is strengthening hardliners in power and reducing prospects for a deal with the United States.
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