Consumer prices rose by 0.09% m/m (market consensus forecast: 0.05% m/m) in July, after declining 0.5% m/m in the previous month, bringing the annual inflation rate to 6.81% from 7.2% in June, data of the statistics office TUIK showed on August 3.
Food prices increased by 0.28% m/m adding 0.06 percentage points to the headline inflation, while the 4.97% m/m decline in clothing prices shaved off 0.33 percentage points. Communication prices fell 0.01% m/m and transportation costs rose 0.41% m/m in July.
The I-index, the central bank’s favourite core inflation indicator, rose 0.11% July an annualised increase of 7.31%.
Last week, the central bank lifted end-year inflation forecast to 6.9% from a previous 6.8%, but left its end-2016 forecast unchanged at 5.5%. The correction in food prices and recent decline in oil prices support disinflation, it also said last week but warned that exchange rate movements have delayed the recovery in the core inflation trend.
TUIK data also showed that domestic producer prices fell by 0.32% m/m and the annual increase in producer prices eased from 6.73% in June to 5.62% in July.
|July CPI by Main Expenditure Groups (%)|
|Food and non-alcoholic beverages||24.25||0.28||9.25|
|Alcoholic beverages and tobacco||4.82||1.16||3.28|
|Clothing and footwear||7.38||-4.97||4.06|
|Furnishings, household equipment||7.78||1.60||8.69|
|Recreation and culture||3.54||-0.18||7.72|
|Hotels, cafes and restaurants||6.98||1.21||13.80|
|Miscellaneous goods and services||4.60||0.10||9.31|
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