Istanbul retail prices up 1 percent in December

Istanbul retail prices up 1 percent in December

Istanbul retail prices up 1 percent in December

Retail prices in Istanbul, Turkey’s largest city, increased 1.07 percent in June from the previous month, data from the Istanbul Chamber of Commerce (İTO) have shown.

That followed a 0.45 percent increase in November.

Food prices rose by 1.55 percent on a monthly basis, while transport and communication costs dropped by 0.20 percent in December from November. Housing costs exhibited a 0.82 percent rise month-on-month.

İTO also reported that household goods prices increased by 1.74 percent on a monthly basis, while culture, education and entertainment costs in the city rose by 1.08 percent in the month.

According to İTO data, clothing prices dropped 0.44 percent while health and personal care costs inched up 0.75 percent in December compared with November.

With the December data, the annual increase in retail prices in Istanbul climbed to 13.41 percent in December from 12.05 percent in November.

The chamber also said that wholesale prices in the city increased 1.4 percent on a monthly basis while the annual increase was 7.68 percent.

The Turkish Statistics Institute (TÜİK) will announce the inflation figures for December on Jan. 3.

Tax hikes postponed

Meanwhile, according to a presidential decision, published on the Official Gazette on Dec. 31, an automatic tax hike on alcohol and tobacco products in line with producer price inflation in the first half of 2020 will not be implemented, a move economists and analysts say is expected to have a positive impact on inflation outlook.

Under the special consumption tax law, the fixed tax on the products is increased in line with producer price inflation.

Economists told Reuters that the move would put a further brake on inflation, which tumbled throughout 2019 from multi-year highs logged in the previous year.

“We think this decision will significantly limit the rise in inflation due to the base effect in the first quarter. The possibility for annual inflation to rise above 12 percent weakened,” said Erkin Işık, the chief economist in QNB Finansbank.

“This decision increased the possibility for the Central Bank to go for a limited policy rate cut in January,” he added.

The annual consumer price inflation increased to 10.56 percent in November from 8.55 percent in the previous month, according to the latest data from TÜİK.