Turkey's annual inflation slips to 11.86% in March

IHA Photo

Turkey’s key inflation rate fell to 11.86% in March as expected, as a drop in global oil prices provided some relief after four consecutive months of rises, the Turkish Statistical Institute (TurkStat) said Friday.

Consumer prices in Turkey went up 11.86% in March compared to the same month last year, the Turkish Statistical Institute (TurkStat) announced on Friday.

The annual inflation rate in March was down from 12.37% the previous month, according to TurkStat.

The highest price rise last month was seen in alcoholic beverages and tobacco, surging 40.19% on a yearly basis.

Communication registered the lowest annual increase with 2.52% in March.

A group of 14 economists polled by Anadolu Agency on Tuesday forecast that consumer prices in Turkey would rise 18.81% year-on-year.

TurkStat data showed that on a monthly basis, consumer prices rose 0.57% in March, in line with market expectations.

The median of estimates for March by 14 economists was a 0.53% rise compared to February.

The highest monthly decrease was 1.91% in transportation while health was the main group posting the high monthly rise with 2.78%.

Turkish government targeted 8.5% of the inflation rate for this year as laid out in its new economic program for 2020-2022 announced last September.

Turkey's Central Bank forecasts year-end inflation to be at 8.2% in 2020.

Commenting on March 2020 figures, Enver Erkan, an economist at private investment company Tera Yatırım, underlined that the decline was driven by falling oil prices and lower economic activity due to coronavirus pandemic.

"These two factors seem to have suppressed the upward effect that will be expected from the depreciation of Turkish Lira in March," Erkan stressed.

He highlighted that boomed demand pushed the price of healthcare services up, adding: the largest decrease was seen in the transportation side with regard to travel restrictions and falling oil prices due to coronavirus effect.

Considering slashed demand and cost impact by exchange rates, Erkan said: "When we exclude volatile items such as food and energy, the state of core inflation more visibly reflects the increase in the exchange rate."

Contact Us