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Friday, March 1, 2024

Turkish inflation at highest level since 2001

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Turkish inflation last year amounted to 64.77 percent. That is the highest level since 2001, the Turkish statistics agency TÜIK reported on Wednesday.

Turkey has been struggling with sky-high inflation for almost two years. The Turkish central bank expects a further increase in inflation to more than 70 percent in May. Only by the end of this year will inflation have fallen to around 36 percent.

Turkish President Recep Tayyip Erdogan tried to control price increases for a long time by cutting interest rates. This goes against the prevailing economic theory that you need to increase interest rates to get inflation under control. The policy did not solve the problems.

The Turkish central bank increased interest rates last month from 40 percent to 42.5 percent. According to the bank, its own “aggressive” policy will end as soon as possible.

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