Turkey inflation shows slight improvement in July but remains high
(MENAFN) In July, Turkey's consumer price inflation experienced a decrease, dropping to 61.78 percent year-on-year from the previous month's rate of 71.60 percent, according to data released on Monday. This reduction in inflation was slightly below economists' expectations, which had forecasted a slightly lower rate. The easing of inflation was attributed to a slowdown in price hikes across various sectors, including education, housing, and hotels. On a month-to-month basis, inflation rose to 3.23 percent in July, a significant increase from 1.64 percent in June, yet still falling short of economists' predictions.
Economists had anticipated that annual inflation would moderate to approximately 62.1 percent and that month-on-month inflation would climb to 3.45 percent in July. Projections for the remainder of the year suggest that the annual inflation rate could decrease further to around 42.2 percent by year-end. Despite the recent improvement, inflation remains a significant concern, prompting the Turkish central bank to take aggressive action by raising interest rates. Since June of the previous year, the central bank has implemented a considerable increase in rates, amounting to 4,150 basis points.
In response to the ongoing inflationary pressures, the central bank has signaled its readiness to further tighten monetary policy if inflation data shows further deterioration. This approach underscores the bank's commitment to controlling inflation and stabilizing the economy despite the challenges posed by persistent price increases.
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