Poland’s WIG20 hits highest-ever closing level of 3,920 points
16 hours ago
Turkey’s consumer price index (CPI) inflation officially edged down to 31.75% y/y in July from 32.11% in June, the Turkish Statistical Institute (TUIK, or TurkStat) said on August 3.
Since April, across the last four months, TUIK has released official annual inflation at 32%, with the rounding of decimals. Since July 2025, the figure has been released at between 30.65% and 33.52%.
TUIK also posted a monthly official inflation figure of 1.78% for July after previously releasing 0.99% for June, 1.71% for May, 4.18% for April, 1.94% for March, 2.96% for February and 4.84% for January.
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.
At 32% y/y, Turkey remains in fifth place in the world inflation league.
End-2026 inflation to amount to around 30%
In May, the central bank raised its end-2026 official inflation “forecast” to 26% in its latest quarterly inflation report from the earlier stated range of 15-21% provided in the previous report released in February.
On August 13, the central bank will release its next quarterly inflation report, the third of 2026.
The USD/Turkish lira (TRY) pair remains under control. After the April 8 Iran war ceasefire was declared, portfolio inflows to Turkey resumed. On July 7, substantial clashes in the conflict began again.
Even prior to the relaunch of the US and Israel's war on Iran on February 28, the probability of a lower-than-30% end-2026 official inflation release was low. With the booming oil prices, the chances have faded further.
Next policy rate meeting on Sept 10
On September 10, the monetary policy committee (MPC) will hold its sixth rate-setting meeting of the year. Crude oil prices, which are directly connected to the ongoing Middle East conflict, will determine the period ahead.
On July 23, the MPC left its main policy rate (one-week repo) unchanged at 37% for a fourth consecutive time in line with expectations.
Following the July 23 meeting, Wall St investment banks again more or less said as one that they would first await the revival of the regulator's one week repo rates, which would bring the active rate (seen in the overnight window rate at 40%) to 37% in August or September, prior to a cutting of the main rate.
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