Central Bank lifts inflation forecast to 65.2 percent

ANKARA

The Central Bank has lifted its end-2022 inflation forecast from a previous 60.4 percent to 65.2 percent.

The bank also increased its estimate for end-2023 from 19.2 percent to 22.3 percent but kept the forecast for 2024 unchanged at 8.8 percent.

Consumer prices increased by 3.08 percent in September from August, which brought the annual inflation rate from 80.2 percent to 83.45 percent.

“Our forecasts are based on an outlook in which macroeconomic policies are determined in a coordinated manner with a medium-term perspective, focusing on disinflation and in line with the liraization steps,” Central Bank Governor Şahap Kavcıoğlu said, speaking at the launch of the bank’s new inflation report in Ankara.

The forecasts indicate that the underlying inflation will gradually decline in 2023 and onwards in a framework where monetary policy is determined in line with the objective of achieving price stability on a sustainable basis, he added.
Food prices will decline towards the year-end and complete 2022 at 75 percent, and 2023 at 22 percent, according to the governor.

In the upcoming period, expectations and exchange rate stability must be compatible with the disinflation process in order for inflation to decline faster, he said.

“In addition, with the implementation of our effective policies, we will not allow deterioration in the pricing behavior of our companies and unhealthy price formations. As a result, we will ensure that expectations and exchange rate stability support the disinflation,” Kavcıoğlu added.