Key View: We forecast real household spending in Iran to grow by 5.5% y-o-y in 2023, an acceleration compared to the estimated 2.5% y-o-y growth in 2022. While rising inflation is a downside risk to our outlook for consumer spending, as the impact of rising food prices weighs on consumer purchasing power, disposable incomes in Iran are rising

Key View

• At Fitch Solutions, we have revised up our FY2022/23 (beginning March 21 2022) inflation forecast for Iran from 42.0% to 48.0% due to the stronger-than-expected currency sell-off.
• We have increased our FY2023/24 inflation forecast from 14.0% to 23.0%, in part to reflect our new core view on the US-Iran nuclear deal.
• We now believe

Key View

• At Fitch Solutions, we are maintaining our fairly optimistic view on Iranian real GDP growth, expecting it to come in at 7.8% in 2022.
• We anticipate the revival of the Joint Comprehensive Plan of Action (JCPOA) in the near term, which will support Iran’s energy exports in the months ahead.
• In 2023, real GDP growth will still exceed

Key View

• We at Fitch Solutions expect that a return to compliance with the 2015 nuclear deal by September 2022 will support public infrastructure investment and support near-term growth in Iran's construction industry.
• Public investment will be the key driver of near-term growth in Iran’s construction sector, as foreign private investors will

Key View

• We at Fitch Solutions have modified our 2022 real GDP growth forecast for Iran from 3.8% to 7.8% to accommodate our new core view on the US-Iran nuclear deal.
• Indeed, we now expect a deal to be struck in the first half of the Iranian new year (March 20 2022 – March 19 2023) rather than later in the year.
• Our new core view implies a

Key View

• Iran’s pharmaceutical outlook will benefit from earlier-than-anticipated lifting of sanctions, stablising the currency and boosting the country’s business environment.
• Iran’s pharmaceutical market will show signs of recovery in the medium-term, tempered by persistent macroeconomic challenges.
• This will support a post-pandemic

Editor’s Note: In this ‘contrarian view’ article, we outline an argument that is in opposition to our core view. In this case, we consider how the potential failure of US-Iran nuclear negotiations would lead to a renewed surge of geopolitical tensions in the Middle East.

Our base case scenario remains for the US and Iran to reach a deal on

Key View

• At Fitch Solutions, our core view remains that the US and Iran will return to the 2015 nuclear deal in 2022, despite the recent hardline stance taken by Iran during the seventh round of negotiations in Vienna, which began on November 29.
• We believe the new government, under President Ebrahim Raisi, has taken a harder stance to build

Key View

• We at Fitch Solutions forecast that Iran’s current account surplus will continue to rise moderately in calendar year 2022, having moved back into positive territory in 2021 after being negative for the first time in over two decades in 2020.
• Rising oil prices and a modest increase in oil output will be the main driver of the widening