ISTANBUL: Turkiye’s annual inflation rate edged up to 61.98% in November, data showed on Monday, just shy of expectations and boosted to its highest level this year by food and transportation prices.
Month-on-month, consumer price inflation (CPI) was 3.28%, according to the Turkish Statistical Institute, also less than a forecast of 3.9% in a Reuters poll.
Annual inflation was expected to have risen to 63% in November before ending the year at 67%, the poll showed. It is seen peaking in May between 70-75% before dipping as an aggressive monetary tightening cycle weighs.
In October, annual inflation had dipped for the first time in three months to 61.36%.
Pakistan’s headline inflation reading clocks in at 29.2% in November
Inflation soared after a currency crisis at the end of 2021 and touched a 24-year peak of 85.51% in October last year. This year, the lira has so far lost some 35% of its value, compounding the cost-of-living crisis for Turks.
The domestic producer price index was up 2.81% month-on-month in November for an annual rise of 42.25%, the data showed.
The latest run-up in inflation began in July on the back of tax hikes and a sharp decline in the lira following May elections.
Since June, the central bank has reversed a years-long policy of low rates that had long been favoured by President Tayyip Erdogan. It has hiked rates by 3,150 basis points to stem inflation and also adjusted a raft of credit rules.
As part of Erdogan’s pre-election pledges, household monthly natural gas consumption up to 25 cubic metres was provided free until May next year.
The lira weakened 44% against the dollar in 2021 and another 30% in 2022. Inflation fell to as low as 38.2% earlier this year, partly due to base effects and a relatively stable lira.
The central bank raised its benchmark rate to 40% last month and said tightening will be completed in a short period of time.
It said recent indicators suggest that domestic demand has started to moderate however the existing level of domestic demand, the stickiness in services inflation, and geopolitical risks keep inflation pressures alive.