The declines in food and oil prices will support disinflation this year, Turkey’s finance minister Mehmet Simsek said on February 18, adding that TRY’s weakness is the only risk for inflation.
The fight against inflation must continue until inflation falls to 5% or below permanently, said Simsek, adding that discussions over the Central Bank’s policies may cause concerns among investors. Taking the price stability into account, the Central Bank must make decisions on a rational basis, Simsek noted.
The Central Bank has been targeted by President Recep Tayyip Erdogan and economy minister Nihat Zeybekci for not cutting interest rates to boost economic growth. Recently, Deputy PM Ali Babacan, the economy czar, voiced support for Central Bank bureaucrats. There is a highly competent team at the Bank who are making the right decisions at the right time, Babacan said.
| January CPI by Main Expenditure Groups (%) | |||
| Weights | m/m | y/y | |
| Headline | 100 | 1.10 | 7.24 |
| Food and non-alcoholic beverages | 24.25 | 3.52 | 10.97 |
| Alcoholic beverages and tobacco | 4.82 | 4.19 | 4.40 |
| Clothing and footwear | 7.38 | -6.98 | 9.14 |
| Housing, utilities | 15.79 | 1.13 | 7.50 |
| Furnishings, household equipment | 7.78 | 2.01 | 8.54 |
| Health | 2.57 | 1.49 | 8.23 |
| Transportation | 15.38 | -0.56 | -0.99 |
| Communications | 4.38 | 0.94 | 3.18 |
| Recreation and culture | 3.54 | 1.64 | 6.08 |
| Education | 2.53 | 0.02 | 8.27 |
| Hotels, cafes and restaurants | 6.98 | 0.90 | 13.06 |
| Miscellaneous goods and services | 4.60 | 2.52 | 9.77 |
| Source: tuik | |||
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