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Last Updated: Monday, 2 October 2006, 13:50 GMT 14:50 UK
Call for Iran to act on inflation
A shopkeeper in Tehran
Food prices have surged but the government says inflation is under control
Iran's supreme leader Ali Khameni has called on the government of President Mahmoud Ahmadinejad to curb surging prices.

Food costs have surged in recent weeks, a period of increased demand as people prepare fast-breaking iftar meals during the holy month of Ramadan.

State official say the government's "massive activities" against inflation have cut the rate to 10.5% from 14.5%.

But non-governmental sources put the real inflation rate at more than 16%.

"In the last weeks the issue of high prices has put a lot of pressure on people, especially low income ones," Iranian news agencies quoted the supreme leader as saying.

"The government and officials should look into the causes of the issue and solve it."

BBC staff in Tehran said that the costs for many staple foods had risen sharply - chicken prices are up 70% over the last two months, the cost cheese and yoghurt has risen 30% and the government has increased the price of bread by 25%.

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