Bank puts inflation forecast higher

ANKARA - Hürriyet Daily News

The Central Bank, governed by Erdem Başçı, increased its inflation forecast to double digits. REUTERS photo

The Turkish Central Bank increased expectations on both year-end inflation and current account deficit yesterday, relying on a periodical expectations survey.
As economists continue to discuss whether the year-end inflation will reach double digits, the bank said yesterday its projection of inflation increased to 10.25 percent from 9.22 percent earlier this year.
The year-end current account deficit forecast, according to a survey released on the Bank’s website, was up to $75.1 billion from $74.5 billion in the previous survey last month.
Inflation in 24 months was foreseen at 6.54 percent, compared with a previous 6.40 percent, it said.
High inflation and the current account deficit are the two main concerns over the rapidly growing Turkish economy.
The bank also dropped its 2011 growth forecast to 7 percent from 7.1 percent. According to the survey, the year-end U.S. dollar expectation climbed to 1.8200 from 1.8000 Turkish Liras.
The bank reveals expectation surveys once every two weeks.
The Central Bank sold $30 million for liras, the maximum amount it offered in an auction yesterday, and got $69 million of bids from banks, compared with $61 million a day earlier when it sold the same amount.