Official data showed that the annual consumer price inflation rate in Turkey rose to 61.98% last November, driven by a rise in food and transportation prices, which was slightly lower than expectations, according to data from the Turkish Statistical Institute released today, indicating that inflation increased by 3.28% on the basis of… Monthly.
A Reuters poll expected the annual inflation rate to rise to 63% last November, ending the year at 67%. The previous October, annual inflation fell for the first time in 3 months to 61.36%.
Inflation rose after the lira crisis at the end of 2021, and touched its highest levels in 24 years at 85.51% in October of last year.
This year, the lira lost about 35% of its value. The data showed that the local producer price index rose by 2.81% on a monthly basis last November, recording an annual rise of 42.25%.
Raising interest
At the end of last month, the Turkish Central Bank announced a rise in the key interest rate by 500 basis points to 40% in the sixth month of the monetary tightening cycle. This increase comes at a time when it is intensifying its battle against inflation and its efforts to support the lira, which is witnessing a decline in its value.
A statement from the bank at the time confirmed that the improvement in external financing conditions, the continuous increase in reserves, and the increase in local and external demand for Turkish lira assets are all matters that contribute strongly to the stability of the exchange rate and the effectiveness of monetary policy, giving a strong indication that it is close to reaching the maximum limits of the extent of raising the interest rate. , thus starting withThe path of inflation decline.
Credit rating
Last Thursday, the Standard & Poor’s credit rating agency announced that it had raised its outlook for Turkey’s credit rating from stable to positive.
The agency stated in a statement that it affirmed Turkey’s credit rating at “B”, while emphasizing the decline in the double deficit.
Standard & Poor’s said that the amendment comes in light of recent policy changes, including the central bank raising the main interest rate to the level of 40%, in addition to the current account surplus recorded last September, and the recovery of usable reserves during the first 17 days of November. Last November.
The B rating is five notches below investment grade. A positive outlook means the rating could improve, but is not tied to a timetable.
The Turkish Central Bank’s total reserves rose last November to reach $136.5 billion, the highest level ever.
The Standard & Poor’s statement expected the Turkish economy to grow by 3.7% this year, and 2.4% in 2024.
