Inflation accelerates to 7.9 pct

Bloomberg

Inflation accelerated to 7.9 percent from 7.7 percent a month earlier, the statistics office in Ankara said on its Web site Friday. The rate was expected to stay at 7.7 percent, according to the median estimate of 15 economists surveyed by Bloomberg. In the month, prices rose 1.1 percent.

The Turkish Lira has fallen 23 percent against the dollar since the start of October, driving up the cost of imported goods. Additionally, rising fruit and vegetable prices were likely to cause a "temporary" acceleration in March inflation, the Central Bank said March 31.

"The Central Bank has won a bit of credibility with its forecast," said Haluk Bürümcekçi, chief economist at Fortis Bank in Istanbul. "Except for food prices, everything looks fairly good and I don’t think this is going to change the Bank’s stance on rate cuts."

The lira currency strengthened after the figures were announced and ended the day at 1.5798 per dollar Friday in Istanbul, compared with 1.593 Thursday.

Prices of groceries and non-alcoholic drinks rose 3.9 percent in the month and alcoholic beverages and tobacco jumped 6.9 percent, the statistics agency said Friday. Transport prices fell 2 percent.