Turkish President Recep Tayyip Erdoğan has said he is aware of the difficulties caused by the high cost of living in the country but also told people to show more patience in the face of record inflation of 78.6 percent in June, Turkish media outlets reported.
The rate of inflation earlier announced by the Turkish Statistical Institute (TurkStat) was the highest since January 1998, but unofficial estimates published by the Inflation Research Group (ENAG), an independent group of academics and economists, showed prices rising at more than double that figure, standing at 175.5 percent in June.
In a message he released on the occasion of the Eid al-Adha holiday, which will begin to be observed on Saturday, Erdoğan said he knows the problems caused by the high cost of living and fluctuations in the value of the Turkish lira against foreign currencies. Yet he asked the Turkish people to extend more support to the economic programs launched by the government and to show “a little bit more patience.”
According to Erdoğan, every country in the world, mainly developed countries, is dealing with their own political, economic and social crises, meaning the current financial crisis is not unique to Turkey.
The crisis started when Erdoğan forced the central bank to make a series of interest rate cuts last year that he said were part of his “new economic model.”
The policy rate went down despite rising consumer prices.
But the Turkish leader rejects conventional economics and insists that high interest rates cause prices to rise.
Economists believe his approach has exacerbated the pain felt worldwide from the jump in food and energy prices caused by Russia’s invasion of Ukraine.
Shrinking purchasing power and economic woes are prompting people to protest across the country since around 40 percent of wage earners in Turkey live on the minimum wage and find it hard to make ends meet due to the high level of inflation and a depreciating lira.