Minister Şimşek Defends High Inflation: “This Is Not Unique to Our Country”

Evaluation of Sectoral Inflation Expectations

Treasury and Finance Minister Mehmet Şimşek assessed the January Sectoral Inflation Expectations data, claiming that the downward trend in inflation expectations is continuing. In his statement, Şimşek emphasized that inflation expectations have declined across households, the real sector, and market participants compared to the same period last year.

According to Şimşek, 12-month-ahead inflation expectations fell by 6.7 points for households, 10.9 points for the real sector, and 3.2 points for market participants on an annual basis. He underlined that household inflation expectations tend to remain above actual inflation and prevailing trends in all countries, stressing that this situation is not specific to Turkey.

Market Expectations and the Disinflation Process

Şimşek also addressed market expectations for year-end inflation, noting that although they remain above official targets, they still signal a meaningful improvement compared to current inflation levels. He pointed out that monthly inflation may rise in January due to seasonal and temporary factors, but expressed confidence that the overall disinflation process will continue throughout the year.

In this context, Şimşek stated that while the market’s year-end inflation expectation of 23.2 percent exceeds the target, it represents a clear improvement relative to the current inflation environment. He added that with progress in the disinflation process over the course of the year, expectations are likely to improve further, helping to ease rigid pricing behaviors and contribute more strongly to the decline in inflation.

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