Turkiye's annual inflation rate hits 24-yr high of 73.5% in May

07 Jun '22

2 min read

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The rise in consumer prices in Turkiye is taking a downward turn, with its annual inflation rate rising at a lower-than-expected pace in May, but still hitting a 24-year high of 73.5 per cent, fuelled by high food and energy prices. President Recep Erdogan said the government is working on ways to alleviate households’ economic woes and combat soaring prices.

Speaking to members of his ruling Justice and Development Party (AK Party), Erdogan reiterated that the government has been closely following the course of the prices and has put under the scope the exorbitant hikes, according to Turkish media reports.

Turkiye’s consumer price index has surged since last autumn as the Turkish lira weakened after the central bank in September embarked on a 500 basis-point easing cycle.

Inflation will be tackled under its new economic programme, which prioritises low-interest rates to boost production and exports to achieve a current account surplus, the government says.

Treasury and finance minister Nureddin Nebati told party members the fight against inflation is the top priority for the near future.

Nebati stressed the importance of strengthening coordination and communication in the fight against rising prices, effective monetary policy, a prudent approach to public finances, as well as comprehensive and effective implementation of macroprudential policies.

The Central Bank of the Republic of Turkiye (CBRT) revised its inflation forecasts for this year and next mainly because of the rise in commodity prices and supply issues. Bank governor Sahap Kavcioglu in April suggested inflation would peak around 70 per cent before June before sliding to 42.8 per cent by the end of the year.

The leading indicators showed that the economy maintained its positive outlook in the second quarter of the year, Nebati added.

ALCHEMPro News Desk (DS)

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