Turkey’s annual inflation rate has accelerated for a third successive month in September, to 61.5%, data by the Turkish Statistical Institute showed on Tuesday.
It has been the highest inflation rate since December 2022, mostly driven by increases in tax rates and the Lira devaluation.
The Turkish currency plummeted to a fresh all-time low of 27.5008 against the US Dollar. The USD/TRY currency pair was last gaining 0.37% on the day to trade at 27.4990.
In September, upward pressure came mostly from cost of housing & utilities (42.3% YoY versus 25% YoY in August) as well as from furnishings and household equipment (59.1% YoY versus 58.9% YoY in August).
Meanwhile, food inflation eased to 68.9% in September from an 8-month high of 72.9% in August.
Prices also eased for transportation (50.3% YoY versus 70.2% YoY in August) and health (70.3% YoY versus 77.6% YoY in the prior month).
Turkey’s annual core inflation accelerated to a 10-month high of 68.9% in September from 64.8% in August.
According to the Middle-Term Program, Turkish inflation is forecast to remain near 65% by the end of this year before decelerating to 33% in 2024 and to 8.5% by the end of 2026.
Last month, the Central Bank of Turkey raised its one-week repo rate by 500 basis points to 30%, in line with market expectations. This brought borrowing costs to their highest level since September 2003.