Parity, import costs have led to high inflation: Turkish Central Bank governor

ANKARA

A weak Turkish Lira and high import costs have led to increased inflation rate in Turkey, the head of the Turkish Central Bank has said, while also pointing to the potential negative impacts of high consumer prices over pricing behaviors.

In a presentation to the Planning and Budget Commission in parliament on April 10, Central Bank Governor Murat Çetinkaya also reiterated that the bank’s monetary policy decisions would be made in an effort to maintain price stability.

“Foreign exchange rate and import costs have played a key role in pushing up the inflation rate,” he said, according to a presentation on the bank’s website.

We assume that the inflation rate would gradually come close to our targets, he added.

The Central Bank’s inflation target is 5 percent, but the annual rate stayed near 10 percent. Consumer prices in Turkey rose 10.23 percent in March, year-on-year, marking a slight 0.03 percentage point decrease compared with the figure of the previous month, the Turkish Statistical Institute (TÜİK) announced on April 3.

The March figure was down from 10.26 percent in February, according to TÜİK data.

Çetinkaya noted that high consumer price index has posed a risk over the pricing behaviors, stressing that the bank’s monetary policy decisions will be taken to maintain price stability.

“We have closely been following the recent developments in terms of their impacts on the inflation outlook,” he added.

Çetinkaya also said various structural measures were also expected to support price stability in the upcoming period.