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In Turkey, goods and services were on average 72.3% more expensive last year than in 2021. In December, inflation eased to 64.3%. Indeed, energy prices have fallen, reports the Turkish statistics agency TÜIK.
Turkey’s central bank expects inflation to fall further this year to 22.3% as energy prices also fall. In 2024, prices are expected to increase by an average of 8.8%.
According to experts, the high inflation in Turkey is due, among other things, to the unusual policy of President Recep Tayyip Erdogan. At his request, the central bank lowered interest rates several times. But according to economists, it is wise to raise interest rates in times of inflation. Erdogan is doing the exact opposite.
The Turkish president hopes this will boost production growth. But because of his policy, the value of the Turkish lira fell sharply against the dollar. The goods that the country has to import have thus become very expensive.
Erdogan has recently taken a number of measures to improve the purchasing power of the Turkish population. For example, the minimum wage was increased by 55% earlier this year. In addition, approximately 3 billion euros have been made available to banks. They can then lend that money to companies.
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