Türkiye Inflation Rises Amid Middle East Tensions

Turkiye's annual inflation rate rose to 32.37% in April, up from 30.87% in March, amid ongoing geopolitical tensions in the Middle East, AzerNEWS reports, citing foreign media.

Figures from the Turkish Statistical Institute show that consumer prices increased by 4.18% month-on-month in April, compared with 1.94% in March. The rise was driven mainly by higher costs in energy, transportation, housing, and food sectors.

The monthly increase exceeded economists' expectations of around 3.30%, suggesting a faster-than-anticipated acceleration in price pressures during the reporting period.

Turkiye has been struggling with persistently high inflation since the 2018 currency crisis. Since then, rising prices have significantly reduced the purchasing power of households and businesses, with inflation peaking at more than 85% at the end of 2022.

The country's central bank has been gradually adjusting its monetary policy since mid-2025, previously lowering its key one-week repo rate in an attempt to support economic stability. However, in March and April, the bank paused this easing cycle and kept the policy rate unchanged at 37%, citing increased external risks and uncertainty stemming from regional tensions.

Analysts note that inflation in Turkiye remains highly sensitive to currency fluctuations, particularly the performance of the Turkish lira against the US dollar and euro. Even small shifts in exchange rates can quickly translate into higher import costs, especially for energy and raw materials.

Interestingly, some economists also point out that despite high inflation, Turkiye continues to experience relatively strong domestic demand in certain sectors, which partially sustains economic activity but also makes price stabilization more difficult. As a result, the country remains in a delicate balancing act between supporting growth and controlling inflation.

MENAFN05052026000195011045ID1111067987