Investment

Inflation in Turkey at 13 percent – highest level since 2003

Summary

Inflation in Turkey rose to almost 13 percent in November, the highest level since 2003. As the Turkish statistics agency TUIK announced, consumer prices rose by 1.49 percent in November compared to the previous month. Inflation thus reached 12.98 percent […]

Inflation in Turkey at 13 percent - highest level since 2003. Currency exchange in Istanbul.  (Source: dpa / Archive / Sedat Suna / EPA)

Inflation in Turkey rose to almost 13 percent in November, the highest level since 2003.

As the Turkish statistics agency TUIK announced, consumer prices rose by 1.49 percent in November compared to the previous month. Inflation thus reached 12.98 percent compared to the same period of the previous year. The government actually wants to bring inflation below ten percent by the end of the year.

According to TUIK, inflation in November was fueled in particular by food prices (+2.11 percent) and transport costs (+2.01 percent). The rise in inflation worries the financial markets and contributes to the further decline in the Turkish currency. Curbing inflation would be possible by raising the key rate, but the central bank is under pressure from the government to cut rates.

Stable economic growth

Even if the continuing decline in the lira and high inflation are a cause for concern, the Turkish economy has recorded robust growth since the beginning of the year. The Organization for Economic Cooperation and Development (OECD) recently raised its growth forecast for 2017 to over six percent. For 2018 and 2019, she expects 4.5 to 5.0 percent. Other organizations have also raised their forecasts.