Turkey’s cautious monetary policy having favorable inflation impact, says Central Bank governor

ISTANBUL - Reuters

“Our inflation expectations are not still in targeted levels,” Başçı said. CİHAN Photo

The Turkish Central Bank’s cautious monetary policies along with prudent fiscal and macro-prudential policies are having a favorable impact on inflation, Central Bank Governor Erdem Başçı said in a presentation on April 6.

Uncertainty in global markets and elevated food prices necessitate maintaining the cautious stance, Başçı said, according to a statement on the Bank’s website citing his presentation to the Turkish Banking Association.
The expected measures by the Food Committee will make an additional contribution to the fight against inflation, he added. 

Consumer prices in Turkey increased 1.2 percent in March over the previous month, data showed on April 3, as rising food costs pushed inflation well above market expectations.

The main reason behind the rise in the headline inflation was food prices, according to analysts. 

“Our inflation expectations are not still in targeted levels,” Başçı said in his presentation.

The Central Bank said in January it expected the year-end consumer price index to come in at 5.5 percent, compared with the lender’s target of 5 percent.