Inflation, prices amidst coronavirus

Prices in Turkey increased 12.6% in June

The rise in the CPI in Turkey exceeds the expectations of economists due to the increase in prices of food, housing and health because of the coronavirus.

The Consumer Price Index (CPI) increased in Turkey above 12.6%, more than expected by economists, amid inflationary pressures due to the rise in prices of some products because of the coronavirus pandemic.

According to the latest data published by the Turkish Statistical Institute (TÜİK), year-on-year inflation in Turkey increased by 12.62% in June, more than one point compared to the 11.39% registered in May. The consulted economists had anticipated that the prices would grow in June around 12.1% in the Eurasian country.

Likewise, the Producer Price Index (PPI) increased 6.17% in June compared to last year, and 0.69% compared to the previous month, according to TÜİK, who points out that the main price increases were found alcohol, food, housing and health: out of a total of 418 items used as a reference in the study, the price of 71 was reduced in June, 57 of them remained unchanged, and the cost of another 290 was increased.

Specifically, it was alcoholic beverages and tobacco that registered the highest year-on-year rise (22.41%), while the lowest occurred in communications (4.84%). On a monthly basis, transportation led the ranking with an increase of 4.49%, while food and alcoholic beverages fell 1.6% compared to May.

Despite these data on prices in June, the Central Bank of the Turkish Republic (TCMB) maintains a downward forecast of the evolution of inflation, which is expected to reach 7.4% at the end of 2020 compared to the previous estimate of 8.2%, thanks to a reduction in imports and the fall in food prices.