Turkish central bank raises 2026 inflation forecast

The interim target for 2027 is 9 per cent.

Presenting the bank's quarterly inflation report in Istanbul, its governor Fatih Karahan said inflation is currently projected to be between 25 per cent and 29 per cent in 2025 and between 13 per cent and 19 per cent in 2026.

"The 'year-end interim targets' will serve as a commitment and anchor," he was quoted as saying by domestic media outlets.

Interim targets will serve as a reference in determining the endogenous monetary policy path, ensuring that inflation converges to the interim targets within the control horizon, he said, noting that this period was between 12 and 24 months.

The bank cut interest rates by 300 basis points last month to 43 per cent, resuming an easing cycle that had been disrupted by political turmoil earlier this year, as markets have since calmed and disinflation continued.

Annual consumer price inflation fell to 33.52 per cent in July this year, after hitting a peak of 75 per cent in May last year.

The bank foresees inflation stabilising at 5 per cent in the medium term.

ALCHEMPro News Desk (DS)