Central Bank to unveil 2026’s first inflation report next week

ISTANBUL

Türkiye’s Central Bank will unveil its first Inflation Report of the year next week in Istanbul.

According to the bank’s announcement, Governor Fatih Karahan will host a briefing to present the “Inflation Report 2026-I” on Feb. 12. The event will take place at the bank’s premises within the Istanbul Financial Center.

This report is a key communication tool for the bank, outlining its assessments of inflation dynamics, monetary policy strategy and economic outlook.

“We will continue to pursue tight monetary policies while maintaining discipline in fiscal policy”, Vice President Cevdet Yılmaz said.

Speaking at an event in the province of Siirt on Feb. 7, Yılmaz emphasized, “We are determined in these areas, but that alone is not enough. We also need to support our fight against inflation with supply-side policies.”

He went on to outline five critical areas: “First is food, second is social housing, third is energy, fourth is logistics and fifth is human resources. We believe that supply-side policies in these five areas will make a significant contribution both to our struggle against inflation and to achieving balanced and sustainable growth.”

The Inflation Report will be important for expectations, particularly regarding the accounting of the 2025 deviation of inflation from target, as well as assessments of the 2026 interim target and forecast band, said BBVA Research in a note.

The Central Bank might keep the point target of 16 percent unchanged in the inflation report; however, given the upside risks, the forecast band may be revised upward for 2026, according to analysts at BBVA Research.

“The inflationary pressure will require the Central Bank to be cautious as we already highlighted with our above-consensus policy rate expectation of 32 percent by year-end,” it said, adding that the bank may adjust the size of rate cuts depending on the risks to the inflation outlook.

BBVA expects 100 bps cuts to continue at the remaining meetings in the first half of the year, with smaller steps in the second half amid persistent inflation stickiness.

In February, inflation could materialize around 2.5 percent, reflecting second-round effects and potential upside risks on food inflation due to Ramadan, it said.

The new inflation report to be published on 12 February will shed more light on the bank’s assessment of the inflation outlook and its stance for the period ahead, said ING in a report.

ING recalled that the Central Bank at its December meeting delivered a lower-than-expected rate cut of 100bp vs the 150bp market consensus “…on the back of noisy inflation data in January and signs of a pickup in domestic demand.”

“We have revised our end-year inflation to 23 percent from 22 percent, above the Central Bank’s forecast range, which was at 19% in the November report.”

ING expects the policy rate to be at 28 percent at the end of 2026.