Iran’s economic problems are getting worse as the country’s inflation rate, which was already near 50% prior to the conflict, keeps rising after weeks of fighting and pressure from sanctions.

Residents have reported abrupt price increases in a number of sectors, including food, medicine, and basic household items. A common food item went from costing 700,000 rials to 1,000,000 rials in a short amount of time, according to a Tehran resident. Meanwhile, life-saving drugs have seen drastic price increases; one cancer treatment tablet reportedly went from costing about three million rials to 180 million.

Businesses have also passed rising costs onto consumers. In central Tehran, a popular café increased prices by 25 per cent in a single day, while in other regions, some imported goods have reportedly tripled in price.

The weakening of the Iranian currency has further compounded the crisis. The central bank has introduced higher denomination banknotes, including a ten-million rial note, reflecting the sharp decline in the value of the rial amid ongoing economic instability.

The economic strain has led to widespread job losses, with many businesses shutting down or reducing operations. Construction activity has slowed significantly, forcing workers, including migrants from neighbouring Afghanistan, to leave the country in search of opportunities elsewhere.

Internet disruptions have added to the challenges, particularly for those reliant on online businesses, as a prolonged communication blackout has limited access to global networks.

Many residents have expressed growing concern about the future, describing the situation as overwhelming due to mass layoffs, business closures, and rising living costs. The conflict has also damaged key sectors of the economy, including steel and petrochemical industries, as well as infrastructure such as roads and bridges, raising concerns about long-term recovery.

Experts warn that the banking sector, already fragile before the war, faces further strain.