Impact of Unending War: Iran's Economy Still Under Heavy Pressure

Residents of Iran are beginning to return to work this week, following a lull in the fighting that provides temporary respite from attacks by the United States and Israel. However, the economic prospects remain grim for much of the population.

In the network of narrow alleys, workshops, and warehouses in Tehran’s Grand Bazaar, the capital’s trading hub, more shops are opening and operating longer hours on Saturday, the first day of the working week, compared to before the ceasefire announced on Wednesday.

Nevertheless, sales remain sluggish compared to the pre-war period, according to traders.

“This is almost total stagnation,” said a trader in the bazaar section selling metal goods, tools, and light industrial equipment, as reported by Al Jazeera on Sunday (12/4/2026).

“We received new price lists from suppliers today, all around 20-30 percent more expensive than at the end of January,” he added, noting the uncertainty over when and how new goods can be imported due to the war.

Prices in January, he continued, had also seen significant increases compared to previous months, impacted by high inflation that worsened following a wave of national protests. During that period, thousands of people were reported killed, and the government imposed an almost total internet blackout for 20 days.