Worst is over in inflation, says Finance Minister Şimşek

ISTANBUL

The worst is over in inflation, Treasury and Finance Minister Mehmet Şimşek has said, adding that “we are the beginning of the disinflation process.”

“We are implementing a very consistent disinflation program," Şimşek said in a speech he delivered at the Turkish Industry and Business Association’s (TÜSİAD) high advisory council meeting in Istanbul.

Inflation is likely decline to 60 percent next month and further down to 50 percent in the following month, according to the minister. The Central Bank’s inflation target of 38 percent for the end of 2024 could be within reach, he added.

“So, we have left the most difficult part of this program behind, the [economic] program is working, and we will succeed,” Şimşek said.

There is a significant improvement in inflation expectations and expectations will further converge to targets in the coming months after strong declines in inflation, the minister added.

The annual inflation rate slowed from 75.45 percent in May to 71.6 percent in June, according to the latest official data with consumer prices rising less-than-expected 1.64 percent month-on-month.

There is no problem regarding fiscal discipline and exchange risks have been reduced, Şimşek also said.

Data to be released on July 12, will probably show that the current account deficit had fallen below 2.5 percent of national income, according to the minister.