Despite the limited increase announced, an economist warns: Inflation is eating away at Iraqis' purchasing power.

Economic expert Ahmed Al-Tamimi warned on Monday (October 20, 2025) of the living repercussions of rising inflation rates in Iraq, despite describing the recent increase as "slight." He stressed that the continuation of this trend could weaken citizens' purchasing power and negatively impact economic and social stability.
Al-Tamimi told Baghdad Today, "The Ministry of Planning's statement regarding a 0.2% increase in the general inflation rate during September compared to August, while seemingly slight, reflects ongoing pressure on prices, particularly on essential goods and services that directly impact citizens' lives."
He explained that "inflation rates in Iraq are affected by several factors, most notably fluctuating exchange rates, increased transportation and service costs, and rising prices of imported food," indicating that this limited increase "may indicate a gradual upward trend unless regulatory and coordination measures are taken between financial and commercial entities."
Al-Tamimi added that "continued inflation, even at low rates, leads to the erosion of purchasing power, especially among low-income earners," calling on the government to "adopt balanced economic policies that focus on supporting local production and reducing reliance on imports, while strengthening market oversight and improving exchange rate management to ensure price stability."
Iraqi markets experience frequent price fluctuations due to the fluctuating dinar-dollar exchange rate and rising transportation and import costs. This has made inflation one of the most significant challenges facing economic policies seeking to achieve stable living conditions for citizens.