World Bulletin / News Desk
Annualized consumer inflation saw a mild rebound to nearly 9 percent in June, indicating that meeting the year-end target of 5 percent will be a difficult task for the Central Bank of Turkey, even as crude prices remained much lower for the sixth month than they were at the beginning of the year.
The Turkish Statistics Institute (TurkStat) announced the monthly inflation figures on Tuesday.
According to its data, the Consumer Price Index (CPI) actually decreased by 0.9 percent from May to June, but was 8.87 percent higher than in the same month a year ago, representing a minor increase in the annualized rate, which was 8.2 percent a month earlier.
Among consumer goods in June, non-alcoholic beverages (3.42 percent), transportation (1.39 percent) and clothing and shoes (0.82 percent) saw a price reduction. At the other end of the scale, communication prices took the lead with a 1.92 percent hike in the sixth month over the fifth.
The June Producer Price Index (PPI) likewise dropped by 1.49 percent compared to May, and was 6.44 percent higher year-on-year. The annualized increase in PPI was 8.06 percent in May. Production costs increased for communication equipment (2.97 percent), potable water (2.13 percent) and furniture (1.89 percent) in June over May. Producers, however, paid notably fewer input cost in the fields of crude oil and natural gas extraction (8.63 percent), charcoal and refined petroleum products (7.04 percent).
Inflation in Turkey is dependent on multiple variables, but among them energy prices are generally game-changers. A barrel of crude was at nearly $80 for the month of June, compared to some $100 in January.
The major factor behind Turkey's intractably high consumer inflation is the rapid expansion of the gross domestic product (GDP) for the past decade. The national economy expanded by 5.4 percent on average each year between 2002 and 2011. Last year's 8.5 percent GDP growth, on top of the 8.9 percent increase recorded a year earlier, made Turkey the fastest-growing economy in all of Europe and within the larger Organization for Economic Cooperation and Development (OECD). For the first quarter of this year, however, the economic growth rate slowed to 3.2 percent, extending a helping hand to the policymakers as they try to beat inflation.
Central Bank Governor Erdem Başçı had predicted in April that people would see decreasing inflation in the country in the second half of 2012, and that the pace of decline would peak particularly in the last three months of the year.
Borsa Istanbul releases integrated annual report for first time
Turkey has served as main route for refugees trying to cross into Europe
Turkish Central Bank fixes foreign exchange rates for rediscount credits repayments
Indices for service, retail trade, construction sectors fall in current month compared with April: Official data
Thanks to advances in shale gas production, notably in the northeast, America has been the world's largest natural gas producer since 2009 and extracted two billion cubic meters per day in 2017.
BIST 100 climbs 0.64 pct while USD/TRY exchange rate stands at 4.7805
Ankara vows to reach 2018 budget targets, says finance minister
American Commerce Secretary Wilbur Ross announced Wednesday he had initiated a so-called Section 232 investigation on auto trade after speaking with President Donald Trump on the matter.
BIST 100 climbs more than 1,100 points; foreign currency exchange rates drop against lira
BIST 100 index goes down 1.39 percent at close; Turkish lira continues to decline against other currencies
Salt Lake storage facility aims to have capacity of 5.4 billion cubic meters by 2023
BIST 100 falls 0.50 percent; US dollar/Turkish lira exchange rate stands at 4.7560
Treasury reports central government debt stock in April rises 15.8 pct year-on-year, reaching $226.8 billion
Trade Commissioner Cecilia Malmstrom spoke ahead of talks of the EU's 28 trade ministers to discuss an attempt to woo the US away from punishing steel and aluminium tariffs and win Europe a similar break as handed China.