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Turkey inflation up near 70%, highest since 2022

Published 05/03/2024, 03:43 AM
Updated 05/03/2024, 04:45 AM
© Reuters. FILE PHOTO: A man pauses in front of a shop in a popular middle-class shopping district in Istanbul, Turkey March 4, 2024. REUTERS/Murad Sezer/File Photo

ISTANBUL (Reuters) -Turkish annual consumer price inflation climbed to 69.8% in April, official data showed on Friday, a bit below expectations but the highest since late-2022 on strong rises in education, restaurants and hotels prices.

Commenting on the figures, Finance Minister Mehmet Simsek said April's month-on-month inflation, which was 3.18%, was in line with expectations. In March it stood at 3.16%.

"After annual inflation reaches its peak in May, it will begin to decline sharply in line with our predictions," Simsek said on social media platform X.

A Reuters poll showed annual inflation was expected to be 70.33% in April, with the rate seen falling to 43.5% by the end of 2024 as an aggressive year-long monetary tightening cycle weighs.

According to the Turkish Statistical Institute, the biggest annual consumer price rise was in education, for which prices rose 103.86%, followed by restaurants and hotels at 95.82%. Food and non-alcoholic drinks prices were up 68.50%.

In January and February, inflation had climbed 6.7% and 4.53% respectively on a monthly basis, largely due to a big minimum wage hike and an array of new-year price updates.

The central bank has hiked rates by 3,650 basis points since June including a 500 basis-point rise in March due to deterioration in the inflation outlook.

It held rates steady last month, nodding to the lagged effects of tightening, and vowed to tighten further in the case of a significant deterioration in inflation.

© Reuters. FILE PHOTO: A man pauses in front of a shop in a popular middle-class shopping district in Istanbul, Turkey March 4, 2024. REUTERS/Murad Sezer/File Photo

The central bank sees inflation peaking around 73-75% in May and starting its decline in the second half of the year, to reach 36% at end-2024.

The domestic producer price index was up 3.60% month-on-month in April for an annual rise of 55.66%, the data showed.

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