Mehrdad Sepahvand, a former adviser to Iran's central bank, responded to U.S. President Donald Trump's assertion that Iran is on the verge of economic collapse. While acknowledging that Iran's economy is deteriorating under sanctions, Sepahvand emphasized that it is not as dire as portrayed, noting that shops remain stocked and public confidence in the banking system persists.
However, he warned that the UAE's recent decision to halt trade ties with Iran could exacerbate economic challenges, potentially leading to a 5% contraction this year. The UAE's actions, prompted by security concerns over Iranian missile activity, are expected to increase inflation and pressure the exchange rate.
Trump's administration continues to apply economic pressure on Iran, aiming to cut off its revenue streams, which Sepahvand argues may inadvertently strengthen hardliners within the Iranian regime and complicate negotiations with the U.S. The situation remains precarious for low-income Iranians facing rising prices and job losses