Annual inflation slows to 31.1 percent in November, hitting 4-year low

ANKARA

Türkiye's annual inflation rate was at 31.07 percent in November, reaching its lowest level in the last 48 months.

The official figures from the Turkish Statistical Institute (TÜİK) showed on Dec. 3 that the inflation rate has been falling continuously for the last 18 months, with the exception of one month.

The inflation was down from 32.87 percent in October, also coming below market expectations of 31.6 percent for November.

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

“In November, inflation had improved by more than 44 points compared with May 2024, while annual core goods inflation fell below 19 percent,” said Finance Minister Mehmet Şimşek, commenting on the latest numbers.

He noted that the moderate trend in monthly inflation is expected to continue in December.

Şimşek said that several factors, including supportive global financial conditions, moderate commodity prices, a tight monetary policy, strengthened financial stability, supply-side policies in areas such as food, housing and energy and acceleration of improvements in inflation expectations will support the disinflation process in 2026.

He added that the government will continue to firmly implement its program centered on price stability.

The highest price rises in November on a yearly basis were seen in education with 66.17 percent, housing with 49.92 percent and hotels, cafes and restaurants with 33.91 percent, according to TÜİK data.

On the other hand, the lowest price hikes were in clothing and footwear with 8.99 percent, communications with 17.78 percent and recreation and culture with 25.87 percent.

TÜİK said there were three main expenditure groups with the highest weight: Food and non-alcoholic beverages with an annual inflation of 27.44 percent, along with transportation with 29.23 percent and housing with 49.92 percent.

"The contributions of these main groups to the annual change were 6.83 percent for food and non-alcoholic beverages, 4.55 percent for transportation and 7.57 percent for housing," it added.

On a monthly basis, consumer inflation also fell from 2.55 percent in October to 0.87 percent in November, coming below market forecasts of 1.25 percent.

One year ago, the annual inflation was at 47.09 percent and 61.98 percent in November 2023.

Now that the November inflation data is out, the focus shifts to the Central Bank and its interest rate decision next week.

In October, the bank’s Monetary Policy Committee (MPC) reduced the policy rate (the one-week repo auction rate) from 40.5 percent to 39.5 percent.

The Committee also lowered the Central Bank overnight lending rate from 43.5 percent to 42.5 percent and the overnight borrowing rate from 39 percent to 38 percent.

The next rate-setting meeting is scheduled for Dec. 11, and the following two meetings will take place on Jan. 22 and March 12, 2026.