Istanbul: Inflation in Turkey surged to over 25 per cent in October from the same period the year earlier, the highest annual rate for over 15 years, official statistics showed on Monday.
Prices have soared in Turkey over the last months as the lira came under pressure, stoking fears over the long-term economic health of the country.
The 25.24 per cent inflation rate for October marked a new increase on the 24.52 per cent recorded in September. It was the highest annual rate since July 2003, when the country was still emerging from its 2000-2001 financial crisis.
The worst affected sectors included furnishing and household goods with 37.92 per cent, according to the Turkish statistics office (TUIK).
The lira fell dramatically over the summer against a backdrop of market mistrust towards President Recep Tayyip Erdogan’s economic policies as well as tensions between Ankara and Washington. The currency has enjoyed a moderate recovery over the last weeks after the central bank on September 13 increased its main policy rate — the one week repo auction rate — from 17.75 per cent to 24 per cent. But at its latest meeting on October 25, the central bank kept the headline rate unchanged.
Inflation is now higher than interest rates, pushing what economists call the real policy rate into negative territory. — AFP
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