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Wednesday, June 29, 2022

Turkey’s inflation soars to two-decade high of almost 49%

Consumer prices jumped 11.1% from the previous month, the Turkish Statistical Institute (TUIK) said, eating deeply into Turks’ earnings. Both measures were higher than expected in a Reuters poll, which forecast 9.8% monthly and 46.7% annually.

The lira shed 44% of its value last year as the central bank slashed interest rates by 500 basis points since September to 14%, under Erdogan’s drive to prioritize credit and exports despite the double-digit price rises.

Partly in response to the currency turmoil, the government raised a series of administered prices this year including for gas, electricity, road tolls and bus fares, adding to inflationary pressure. The monthly minimum wage was hiked 50%.

Transport-related prices soared 68.9% year-on-year in January, while food and drinks prices jumped 55.6%, driving overall inflation to its highest level in Erdogan’s nearly two decades in…

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