Annual Inflation In Turkey Falls For Fourth Consecutive Month

The figure marked the lowest increase in consumer prices in Turkey since November 2021, when it was 21.31 percent.

Official data from the Turkish Statistical Institute (TÜİK) showed on Feb. 3 that the inflation rate has fallen continuously for the last 20 months, with the exception of one month.

Food prices, which rose significantly above the long-term average due to the impact of adverse weather conditions and seasonal factors, had an impact on consumer prices in January, Treasury and Finance Minister Mehmet Simsek said on X, commenting on the latest numbers.

Şimşek stated that the government anticipates factors specific to January will have a limited impact on the underlying trend of inflation.

"The decline in annual services inflation has continued uninterrupted for 21 months, while core goods inflation maintained its moderate course at 17.4 percent," he noted, adding that "annual rent inflation decreased by 44 points compared to the same month of the previous year."

“We will resolutely continue our disinflationary policies, supported by supply-side measures. In this way, we expect the underlying trend of inflation to decline and the rigidities in pricing behavior to ease,” Şimşek said. 

The highest annual price increases in January were seen in education at 64.7 percent, housing at 45.36 percent and hotels, cafes and restaurants at 33.31 percent, TÜİK data showed.

Clothing and footwear saw the lowest price hikes at 7.07 percent, followed by communications at 20.09 percent and health at 21.63 percent.

On a monthly basis, consumer inflation was at 4.84 percent in January.

With the annual inflation rate continuing to ease, attention is shifting to the Central Bank’s Monetary Policy Committee (MPC) meeting next month, where the interest rate decision will be made.

In January, the Central Bank lowered its policy rate — the one‑week repo auction rate — by 100 basis points, from 38 percent to 37 percent. Most economists had anticipated a deeper cut of 150 basis points. The MPC also reduced the overnight lending rate from 41 percent to 40 percent and the overnight borrowing rate from 36.5 percent to 35.5 percent.

The next MPC meeting is scheduled for March 12, followed by another rate‑setting meeting on April 22.