Turkey: Central Bank predicts inflation will rise in December

The Central Bank of Turkey on Tuesday announced a 1.73 percent rise in the consumer price index (CPI) for November and predicted that the figures on the index will continue to increase in December. Turkey’s annualized inflation rate of consumer prices increased from 7.66 percent in August to 9.48 percent in November, and economists say double-digit inflation is now almost certain by year-end.

According to the central bank, changes in the price of unprocessed food items caused the rise in the CPI, pushing it to 9.48 percent for November. The bank stated, “The annual inflation rate is predicted to continue its rise within the expected limits for December due to the base effect on the prices of unprocessed food items.”

In November, there was a TL 30 rise in civil servants’ salaries and pensions because of the high inflation figures. It is expected that a rise in inflation for December will be reflected in these payments again.

Turkey’s inflation has demonstrated a sharp increase starting in the second quarter, as the Turkish Statistics Institute (TurkStat) announced last month. The base effect on prices of processed food items and the weakening of the Turkish lira are cited as the major factors behind the increasing inflation. The base effect from hikes in the private consumption tax (ÖTV) on certain products in October, along with rising prices for crude oil in global markets, are responsible for the high figures this November.

06 December 2011
TODAY’S ZAMAN, İSTANBUL 0