Turkish Central Bank says February inflation rises because of food prices but core inflation improves

By bne IntelliNews March 4, 2015

Consumer prices rose 0.71% m/m and February, bringing the annual CPI inflation rate to 7.55% from 7.24% in January and the rise in inflation was due to food prices, said the Central Bank in its regular monthly price developments report.

Food prices rose 2.59% m/m, adding 0.67 percentage points to the headline inflation, data of the statistics office TUIK showed on March 3.

Improvement in core inflation indicators continued, the Bank also said. The core inflation, measured by the I-index, fell 0.14% m/m in February after rising 0.22% m/m in January. The annual increase in the I-index further eased to 7.73% from 8.63% in January. The I-index excludes the prices of energy, food and non-alcoholic beverages, alcoholic beverages and tobacco products and gold.

In the minutes of the latest monetary policy committee meeting, released on March 3, the Central Bank argued that lower level of commodity prices, particularly oil, continues to support disinflation but warned that the recent volatility in oil prices and exchange rates might limit the support provided by energy group to disinflation. Food prices may see some volatility, especially in unprocessed food, due to weather conditions, the Bank also said in the minutes.

February CPI by Main Expenditure Groups (%)
  Weights m/m y/y
Headline 100 0.71 7.55
Food and non-alcoholic beverages 24.25 2.59 13.70
Alcoholic beverages and tobacco 4.82 -0.44 3.91
Clothing and footwear 7.38 -6.58 7.40
Housing, utilities 15.79 0.46 7.50
Furnishings, household equipment 7.78 0.23 7.37
Health 2.57 0.82 8.29
Transportation 15.38 1.77 -1.49
Communications 4.38 0.94 3.95
Recreation and culture 3.54 0.58 6.03
Education 2.53 -0.08 7.96
Hotels, cafes and restaurants 6.98 1.06 12.66
Miscellaneous goods and services 4.60 0.59 9.18
Source: tuik      
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