In June, Turkey’s Consumer Price Index increased by 1.94 percent, above expectations, with an annual rate of 17.53 percent. According to BBVA analysts, inflation will linger around 18.5 percent until November, then fall to roughly 16 percent by the end of the year due to base effects.
“After the reopening of the economy with 2.5 percent mum on the back of basic goods and services price inflation, core inflation reflected the continuing exchange rate pass-through impact and strong supply-side fundamentals.”
“With still-strong domestic demand, increased commodity prices, the delayed effect of currency rate pass-through, deteriorating inflation expectations, and other supply-side issues, the risks are still skewed to the upside.”
“Higher commodity prices, deepening cost push factors, continued exchange rate pass-through, and still-growing domestic demand maintain inflation risks on the upside. We lower our year-end inflation projection to 16% and anticipate the CBRT to begin easing in October, but in a much more gradual way “”In a sense.”/n
