Turkey’s annual inflation rate rises to 7.14 pct in August

Turkey’s annual inflation rate rises to 7.14 pct in August

Turkey’s annual inflation rate rises to 7.14 pct in August

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Inflation in Turkey increased in August after falling for two consecutive months, largely due to the rise in unprocessed food prices, official statistics revealed on Sept. 3.

The annualized inflation rate rose to 7.14 percent in August from 6.81 percent in the previous month, according to Turkish Statistical Institute (TÜİK) figures.

The Consumer Price Index saw a 0.4 percentage point increase in August from July, during which the index saw a sharp decrease. 

The food and non-alcoholic beverage prices, which constitute around 30 percent of the consumption basket, rose by 1.31 percent on a monthly basis and 9.71 percent on a yearly basis in August. 

“When new data was examined, we saw that both monthly data at 0.4 percent and annual data at 7.14 percent were over the forecast at 0.1 percent and 6.8 percent respectively,” economist Eren Can Umut from Meksa Securities said, quoted by Anadolu Agency. 

“Since the recent sharp depreciation in the Turkish Lira increases the cost of production, it is normal to see a surge in prices,” Umut said.

The lira lost around 21 percent in value this year, becoming one of the world’s worst performing currencies. 

Garanti Investment Chief Economist Gizem Öztok Altınsaç said the bank had revised up its year-end inflation expectations from 7 percent to 7.7 percent, and for 2016 from 6.6 percent to 7 percent, as reported by Reuters.

In August, the highest monthly increase was 2.05 percent in hotels, cafes and restaurants, while the largest monthly decline was 4.32 percent in clothing and footwear, according to the report.

The highest annual increase was 14.26 percent for hotels, cafes and restaurants, added the report.