The 2023 target, which was announced with flashy advertisements, was postponed to the end of 2025 by the President of the Central Bank, at the end of the 7th month of the year.
Explaining that the new target is the end of 2025, Central Bank Governor Hafize Gaye Erkan said that they increased their inflation forecasts for the end of 2023 from 22.3 percent to 58 percent and food inflation to 61.5 levels.
AFTER 2025 MAY BE THE START PERIOD OF STABILITY
While every segment of society, from industrialists to tradesmen, from farmers to retirees, civil servants and workers, was waiting for a solution from the government in a short time, in an environment of severe economic conditions and inflation, the Central Bank revealed the bitter recipe.
Central Bank of Turkey (TCMB) Chairman Hafize Gaye Erkan stated that they see 2025 as the beginning of stability.
"We see the aftermath of 2025 as the beginning of the period of stability. In this period, while the decline in inflation will accelerate, predictability will increase," Erkan said.
Hafize Gaye Erkan, President of the Central Bank of the Republic of Turkey (TCMB), announced the third Inflation Report of the year at the information meeting held at the Central Bank Headquarters.
Erkan stated that they have increased their 2023 year-end inflation forecast to 58 percent, updated their 2024 year-end forecast to 33 percent, and that they expect inflation to decline to 15 percent at the end of 2025.
Stating that since the previous Inflation Report, crude oil prices in spot and futures markets have been in line with their projections, Erkan stated that his assumptions regarding oil prices have remained flat.
SIGNIFICANT INCREASES RELATED TO RED MEAT WAS OBSERVED
Erkan stated that they have updated their import price assumptions for 2024 upwards due to the geopolitical and supply-side effects on the futures markets in commodities and energy.
Emphasizing that the upward trend in domestic food prices continues due to supply-side problems and inadequacies in the market structure, Erkan informed that there have been significant increases in red meat and processed food products related to red meat recently.
CENTRAL BANK INCREASED YEAR-END INFLATION FORECAST FROM 22.3 TO 58
Pointing out that besides red meat, vegetable prices, which are affected by supply conditions, also observed high increases, Erkan said, "We have projected the assumption that food price inflation will reach 61.5 percent in 2023 and 35 percent in 2024 in the upcoming period. In this context, we made an important update in our inflation path. We raised our 2023 year-end inflation forecast to 58 percent. We updated our 2024 year-end forecast to 33 percent. We estimate that inflation will decline to 15 percent by the end of 2025. The revision in our estimation path was 35.7 points for the end of 2023 and 24.2 points for the end of 2024."
When asked when and at what level they expect to see the peak in inflation next year, Erkan said that they expect the peak in the 2nd quarter of 2024 and around 60 percent.
INFLATION ESTIMATED OVER ONE HUNDRED PERCENT
Erkan stated that they expect the peak in inflation in the second quarter of 2024 to be around 60 percent.
Hafize Gaye Erkan, President of the Central Bank of the Republic of Turkey (CBRT), who made a statement at the information meeting to introduce the third Inflation Report of the year,
"We raised our 2023 year-end inflation forecast to 58 percent, we updated our 2024 year-end forecast to 33 percent, and we expect inflation to decline to 15 percent by the end of 2025. The revision in our estimation path was 35.7 points for the end of 2023 and 24.2 points for the end of 2024," Erkan added.