This study examines the impact of monetary policy shocks on the EXCHANGE RATE and their effects on the import price index in Iran using a Vector Autoregression (VAR) model over the period 1980–2020. Three regression equations are proposed to analyze these relationships. The estimation results of the first model indicate that the free EXCHANGE RATE and Gross Domestic Product (GDP) exert the most significant shocks on the import price index. While the impact of EXCHANGE RATE shocks diminishes over time, the effect of GDP shocks increases, particularly approaching the 10th year. In the second model, which incorpoRATEs the ratio of money supply to GDP, findings confirm that in the second year, the free EXCHANGE RATE exerts the highest shock on the import price index, accounting for 14.79642% of the variance. In subsequent years, the free EXCHANGE RATE and GDP remain the primary drivers of fluctuations in the import price index. Over time, the EXCHANGE RATE's influence slightly decreases, whereas the impact of GDP strengthens. The third model, which includes the liquidity-to-GDP ratio, further supports these findings, revealing that the free EXCHANGE RATE and import levels contribute most significantly to variations in the import price index. The results underscore the dominant role of the free EXCHANGE RATE and GDP in shaping import price fluctuations, with monetary policy shocks influencing their relative impacts over time.