Business Monitor International, the credit risk rating and political risk analysis organization, recently published its “Iran Business Forecast Report Q4 2013.” Following are the highlights of the report distributed by USPRwire:
“The (Iranian) economy will remain a regional laggard as investment activity stalls following the imposition of a more stringent set of international sanctions on the regime in 2012 and 2013.
The Iranian rial will remain under fundamental downside pressure as households continue to shift their savings into dollars and gold.
We have revised our real GDP growth forecasts this quarter, and are projecting the economy to fall 2.0% in real terms in 2013, up from our previous forecast for a 2.3% contraction.
The victory of moderate Hassad Rouhani in presidential election in June will bolster business confidence, while we expect macroeconomic management to improve.
Growth will return in 2014; however, the economy will continue growing below potential over the coming years.
Although improved confidence on the country's economic trajectory and more cordial relations with the West will cushion from a dramatic drop in the value of the rial, downside pressure on the unit will remain elevated this year. As a result, inflationary pressure will remain raised over the coming quarters.
Higher global energy prices may lead to upside risk to our growth forecasts and downside risk to our fiscal deficit forecasts.”