Turkey’s consumer price index (CPI) inflation officially crept down from 33.29% y/y in September to 32.87% y/y in October, the Turkish Statistical Institute (TUIK, or TurkStat) said on November 3.

Official inflation stood at 44% y/y at end-2024.

It is not advisable to plan, price or draw inferences based on TUIK data. There is widespread concern about the reliability of Turkey’s official data series.

Central bank falters on path again

TUIK also posted a monthly official inflation figure of 2.55% for October after releasing 3.23% for September, 2.04% for August, 2.06% for July, 1.37% for June, 1.53% for May and 3.00% for April.

On August 14, Turkey’s central bank raised its end-2025 official inflation "forecast" range to 25-29% in its latest quarterly inflation report.

It also anticipated that the seasonally-adjusted monthly inflation figures would fall below the 1.5%-level starting from 3Q25 and end the year at a little above the 1%-level.

TUIK, meanwhile, released an average seasonally-adjusted monthly inflation of 2.62% for 3Q25. The latest October release does not suggest any improvement in the last quarter.

Moved up in global inflation league

At 33%, Turkey moved up to fifth place in the world inflation league after Argentina, Haiti and Zimbabwe delivered lower figures.

Despite the TUIK factor, which critics say prefers releasing favourable figures at the expense of further diminishing its already flimsy credibility, Turkey’s official inflation has remained around the 33%-level since July.

Undeniable fiasco

Given how global peers are doing better, criticism directed at the management of Turkey’s economy is getting louder.

The finance industry is pushing for at least a pause in the monetary easing process, while those suffering the high real rates (particularly real economy actors and exporters) are circulating louder and louder complaints that the rate policy is not producing the desired fruits.

Academic criticism over the policy of providing the finance industry with high real returns without any supportive fiscal and structural measures is also becoming more frequent and louder. All in all, the chatter among critical observers points to an undeniable fiasco.

Carry and debt inflows work

Nevertheless, the policy, which has a single goal, namely pulling in some FX, works in terms of the carry trade and debt inflows.

January data to solve above-30% deadlock

With the January 2026 data, TUIK will change its base year in its official CPI series to 2025 from 2003. The revision will most probably solve the deadlock over annual inflation at around 33% y/y in the official inflation series.

No end-2025 figure below 30% anymore

However, finance minister Mehmet Simsek confirmed on October 31 that there is no longer a plan to release an end-2025 inflation figure below the 30% level.

New inflation report on Friday

On November 7, the central bank will release its next and last quarterly inflation report for this year. It will include updated forecasts.

December 11 to bring year’s final rate cut

On October 23, the monetary policy committee (MPC) of the central bank cut its main policy rate (one-week repo) by 100 bp to 39.5%. 

On December 11, the authority will hold its last rate-setting meeting of the year. Another rate cut is a near certainty. Uncertainty, however, surrounds the likely size of the cut.

As things stand, any decision within the wide range between no cut and up to 400 bp would be no surprise. Developments in the upcoming one-month period will be determinative.

The USD/TRY pair remains under control. Turkish borrowers’ eurobond auctions have escalated. On the loans side, high debt rollover rates and low costs are observed.

After a court dropped the case targeting the headquarters of the main opposition Republican People’s Party (CHP) on October 24, the political stress that was bugging the finance industry dissolved.