Turkey's inflation hit near 70 percent, highest since 2022

According to official figures from the TÜİK, inflation in April rose by 3.18 percent in Turkey, while annual inflation climbed to 69.8 percent. However, data from the independent inflation research group ENAG showed that monthly inflation was higher at 5.02 percent, with the annual increase reaching 124.35 percent.

Friday May 03 2024 12:06 pm

Reuters & Duvar English

Turkish annual consumer price inflation climbed to 69.8% in April, official data showed on May 3, 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 Şimşek 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," Şimşek said on social media platform X, formerly Twitter.

Nisan ayında enflasyon beklentiler doğrultusunda yüzde 3,18 gerçekleşti.

Programımız sayesinde ekonomideki dengelenme ve azalan cari açık, yeniden tesis edilen bütçe disiplini, uluslararası kaynak girişindeki güçlü artış ve yurtiçi portföy tercihlerinin TL’ye yönelmesi,…
— Mehmet Simsek (@memetsimsek) May 3, 2024

Meanwhile, according to the unofficial data provided by Inflation Research Group (ENAG), an independent institution established in 2020 to monitor the Turkey's inflation, CPI increased by 5.02 percent in April while the annual inflation was 124.35 percent.

ENAGrup Consumer Price Index (E-CPI) increased by 5.02% in April, 2024.

E-CPI increased by 124.35% in the last 12 months
— ENAG (@ENAGRUP) May 3, 2024

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.

U.S. stocks rallied on Thursday, a day after the Federal Reserve soothed investors nerves by suggesting interest rates would not head further north. 00:0201:59

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.