The Turkish Statistical Institute (TÜİK - TurkStat) announced an increase in the consumer inflation rate for October 2020 compared with the previous month as 2.13%, resulting in the annual-to-date rate coming at 11.89%, a slight increase on the previous month’s rate of 11.75%. Market analysts had predicted that the rate would stay close to the previous month’s rate.
The highest monthly increase was recorded in clothing and footwear with 6.81%, followed by food and non-alcoholic beverages with 3.03%, household goods with 2.45%, transportation with 2.04%, miscellaneous goods and services with 2.02%, and housing with 2.01%. The lowest monthly increases were recorded in health with 0.88%, restaurants and hotels with 0.71%, communication with 0.23%, and education with 0.00%. Monthly decreases were recorded in entertainment and culture with 0.09% and alcoholic beverages and tobacco with 0.01%.
The highest annual increase was recorded in miscellaneous goods and services with 27.40%, followed by food and non-alcoholic beverages with 16.51%, health with 15.60%, transportation with 13.92%, household goods with 12.98%, and restaurants and hotels with 11.15%. The lowest annual increases were recorded in alcoholic beverages and tobacco with 0.67%, followed by clothing and footwear with 2.22%, communication with 5.48%, education with 7.36%, housing with 8.37%, and entertainment and culture with 8.66%.
There is much speculation as to the accurateness of the inflation figures produced by TurkStat as ordinary citizens understandably feel that they have experienced a much higher rise in the cost of living over the last year. In the New Economic Program announced on 29.09.2020, the yearend inflation forecast for 2020 was 10.5%, with a fall to 8% in 2021, to 6.0% in 2022, and 4.9% in 2023. The Turkish Central Bank revised its inflation rate forecast for 2020 to 12.1% and for 2021 to 9.4% on 28.10.2020. The inflation rate is currently now 1.64 percentage points above the Turkish Central Bank’s policy interest rate of 10.25%.