ANKARA
The annual inflation rate has continued to decline, slowing from 48.58 percent in October to a 17-month low of 47.09 percent in November, according to data from the Turkish Statistical Institute (TÜİK) on Dec. 3.
This represents the sixth consecutive month of easing in the annual inflation.
“The decline in services inflation and improving inflation expectations show that we have made significant progress in reducing rigidities,” Finance Minister Mehmet Şimşek said, commenting on the latest inflation print.
Services inflation was at its lowest level since November 2021 at 1.6 percent monthly, and the downward trend in annual services inflation continued, Şimşek wrote on X.
Despite food inflation remaining high for the last two months, annual goods inflation fell below 40 percent, the minister noted.
Energy prices showed significant relief, with annual increases slowing to 46.08 percent in November compared to 59.37 percent in October, the TÜİK data showed.
Food and non-alcoholic beverages price hike, on the other hand, accelerated to 48.57 percent year-on-year in November, versus 45.28 percent in October.
Housing costs increased by 2.4 percent month-on-month and 74.45 percent year-on-year last month, according to the TÜİK data.
Transport prices rose by 0.29 in November from October, for an annualized increase of 26.24 percent, while clothing prices declined by 0.25 percent month-on-month.
Education prices were almost unchanged on a monthly basis, but they surged 92.5 percent from November 2023.
Prices at restaurants and hotels increased by 0.79 percent monthly and the annual increase was 59.4 percent.
Core inflation, which strips out volatile items such as energy and food, also eased slightly to 47.13 percent in November.
On a monthly basis, the consumer prices index rose at the slowest pace since June at 2.24 percent in November, cooling from 2.88 percent in October.
Even though they showed declines, the monthly and annual inflation rates in November were higher than the market had expected.
Economists forecast the monthly and annual inflation rates at 1.98 percent and 46.71 percent for November, respectively.
The country’s Central Bank has been keeping borrowing costs high to battle inflation.
The bank began to raise interest rates last year to battle soaring prices. Its main interest rate has been kept at 50 percent for the past eight months.
The bank has raised its forecast for inflation for this year and the next as consumer price increases slowed less than expected in recent months.
It now expects inflation to reach 44 percent at the end of 2024, up from a previous estimate in August of 38 percent.
Consumer prices are expected to rise by 21 percent by the end of 2025, compared to 14 percent in the last forecast.
