The Consumer Price Index (CPI) increased by 3 percent on a monthly basis in November with the ongoing price increases, and with a limited decline to 84.65 percent on an annual basis, the first decrease from the peak of 24 years was expected. The inflation rate for November will be announced by Turkstat on December 5, at 10.00:XNUMX.
The continuing depreciation of the Turkish lira is expected to bring along an increase in inflation. The inflation rate, which reduces the purchasing power day by day, is anxiously awaited by the citizens.
What is the Inflation Rate Expectation?
Annual inflation forecasts for November range from 11 percent to 82.7 percent, in the survey conducted by Reuters with 85.3 respondents.
CPI was realized as 85.51% in October. In the survey, monthly inflation is expected to be 3 percent; Estimates range from 1.9 percent to 3.4 percent.
According to economists, food, tobacco products, furniture, household appliances, clothing and footwear items will be the areas where high monthly increases are seen in November. In the Reuters poll, the forecast for the end of 2022 was 69%.
In the last inflation report of the year, the CBRT stated that the inflation would decrease rapidly from its current level after November and raised its year-end forecast to 65.2 percent.
The government aims to fight inflation by turning the chronic current account deficit into a surplus by implementing an economy program that supports production and exports with low interest. There is a significant base effect in inflation since the sharp rises in the Dollar/TL in November and December of 2021 did not happen this year. The base effect will be more pronounced in December and January, when double-digit inflation compared to the previous month is seen. Thus, even if price increases continue, annual inflation will decline significantly in the next 2 months. Pointing out that the economic activity continues to lose momentum despite rising inflation, the Central Bank (CBRT) cut the policy rate by 150 basis points to 9% in response to President Tayyip Erdoğan's single-digit interest call. Confederation of Turkish Trade Unions (Türk-İş), food inflation calculated in Ankara increased by 4.87% in November compared to the previous month; announced that the hunger limit was 7,785 TL and 2,285 TL above the current minimum wage.
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