Inflation in Turkey hits two-decade high at 70%

currency slide was triggered by a 500 basis point rate cut cycle that began last September under pressure from President Tayyip Erdogan, causing consumer prices to rise steadily.

On a monthly basis, consumer prices rose 7.25%, compared with a Reuters survey forecast of 6%, according to the Turkish Statistical Institute. Annual consumer price inflation was projected at 68%.

The data showed that consumer price increases were driven by a 105.9% jump in the transport sector, including energy prices, and an 89.1% jump in food and non-alcoholic beverages.

On a monthly basis, food and non-alcoholic beverage prices rose the most, at 13.38%, while home prices rose 7.43%.

The government has said that inflation will be covered by its new economic program, which prioritizes low interest rates to increase production and exports in order to achieve a positive current account balance.

However, economists believe that inflation will remain high until the end of 2022 due to the war in Ukraine.

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