Consumer prices rose 0.43% m/m in February, slightly higher than the market consensus forecast of 0.41%, data of the statistics institute TUIK showed on Monday. The monthly CPI inflation was 1.98% in January.

The annual inflation rate accelerated to 7.89% from 7.75% in January, remaining well above the government’s 2014 target of 5%. Food prices rose 0.13% m/m, adding 0.03ppt to the monthly rise in headline inflation while alcoholic beverages & tobacco prices increased 0.02% m/m. Clothing prices were down 5.06% m/m but transportations costs rose 2.29% m/m, adding 0.39ppt to the headline inflation. Communication prices increased 0.19% m/m in February. Automobile prices rose 4.43% m/m, TUIK data showed.

One of the Central Bank’s favourite core inflation indicators, the so-called I-Index (which excluded the prices of energy, food and non-alcoholic beverages, alcoholic beverages and tobacco products and gold) posted a monthly increase of 0.7% for an annualised rise of 8.43%.

TUIK also said that domestic producer price index rose 1.38% m/m in February after it increased 3.32% m/m in the previous month but the annual rise accelerated to 12.4% from 10.72% in January.

Factors affecting inflation adversely will keep inflation indicators considerably above the 5% target for a while, the Central Bank said recently. External uncertainties coupled with the elevated domestic uncertainties caused additional exchange rate movements, which weighed on the risk of inflation exceeding the target for a protracted period, the Bank stressed. Moreover, the recent tax adjustments and the persisting unfavourable course of food prices also exacerbated the deterioration in the inflation outlook, according to the Bank.