Turkey Inflation July 2016

Turkey

Turkey: Inflation jumps to six-month high in July

August 3, 2016

In July, consumer prices rose 1.16% over the previous month and more than doubled June’s 0.47% increase. According to the statistical office, July’s increase reflected much higher prices for alcoholic beverages and tobacco as well as for food and non-alcoholic beverages. The weakening of the lira following the failed military coup on 15–16 July raised import prices and contributed to the surge.

Inflation shot up from 7.6% in June to 8.8% in July. The print came in above the 8.5% that market analysts had expected and represented the highest reading in six months.

The core prices index, which excludes more volatile categories, such as unprocessed food and energy, increased 0.76% in July over the previous month (June: +0.20% month-on-month). Core inflation jumped from June’s 8.9% to 9.5% in July.

Turkey’s Central Bank forecasts inflation to be 7.5% at the end of 2016 and 6.0% in 2017. FocusEconomics panelists expect inflation to close 2016 at 7.6%, which is down 0.1 percentage points from last month’s forecast. For 2017, the panel sees inflation moderating to 7.1% by year-end.


Author: Ricard Torné, Lead Economist

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Turkey Inflation July 2016

Note: Year-on-year and month-on-month variation of consumer price index in %.
Source: Turkish Statistical Institute (TurkStat).


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