World Print edition: 2019-11-05

Turkish inflation hits near three-year low

Published Updated

Last year, inflation surged in September and hit a 15-year high above 25% in October as Turkey's currency crisis sent the cost of imports soaring. It has since dropped, and last year's sharp jump pushed down the annual reading on Monday.

A Reuters poll forecast annual inflation of 8.6% in October. It was the second consecutive month of single-digit inflation, having fallen to an annual 9.26% in September from 15.01% the previous month.

Month-on-month, consumer inflation stood at 2.00% in October, data from the Turkish Statistical Institute showed, compared with a poll forecast of 2.02%.

October inflation was driven by a 11.7% month-on-month rise in clothing and shoes prices, while food prices were up 1.65%.

The Turkish lira weakened to 5.7025 against the dollar after the data from around 5.69 beforehand.

Last week's inflation poll showed that end-year annual inflation was seen at 12.3%, down from a forecast of 13.3% a month earlier. Inflation is expected to return to double-digits in the last two months of the year as base effects wear off.

In its quarterly inflation report last Thursday, the Turkish Central Bank reduced its year-end inflation estimate to 12% from 13.9% in its previous report.

The producer price index was up 0.17% month-on-month in October for an annual rise of 1.70%, data from the Turkish Statistical Institute also showed.

Copyright Reuters, 2019