October 3, 2014

In September, consumer prices increased 0.14% over the previous month, which was slightly above the 0.09% rise recorded in August. According to the statistical office, the reading was primarily the result of higher readings for education as well as for hotels, cafes and restaurants. Annual inflation fell from 9.5% in August to 8.9% in September. The print, which represented the lowest rate since March, defied market expectations of 9.4%.



The core inflation index, which excludes more volatile categories such as unprocessed food and energy, rose 0.25% in September over the previous month (August: +0.08% month-on-month). Annual core inflation ticked down from 9.9% in August to 9.4% in September.

The Central Bank of Turkey (CBRT) sees inflation ending 2014 at 7.6% before slowing to 5.0% at the end of 2015. The Bank’s official inflation target remains at 5.0%. FocusEconomics panelists expect inflation to close 2014 at 8.3%, which is up 0.3 percentage points from last month’s forecast. For 2015, the panel sees inflation moderating to 6.7% by year-end.