Turkish households’ expectations for annual inflation 12 months ahead stood at 71.6 percent in September, down 1.5 points from a month earlier, Reuters reported on Wednesday, citing central bank data.
Market participants’ expectations for annual inflation 12 months ahead fell by 1.2 points to 27.5 percent in September, the data showed, leaving a wide gap with households.
The real sector’s inflation expectations for the same period dropped 2.7 points to 51.1 percent in September, it also showed.
The central bank has said that one factor determining when it will begin easing policy is the extent to which households and the real sector’s expectations converge with its and the market’s view.
Turkey has been battling a cost-of-living crisis that prompted President Recep Tayyip Erdoğan to drop his opposition to interest rate hikes to combat inflation.
The central bank began to raise its key rate in June 2023, gradually taking it from 8.5 percent to 50 percent.
Central Bank Governor Karahan told Reuters in a July interview that the central bank is determined to combat soaring prices and will stick patiently to its tight policy stance.
“We will maintain tightness and wait for data and expectations to get in line with our disinflation path. We think we still have some ways to go in this regard,” Karahan said.
“We want to see a significant and sustained fall in the underlying trend of monthly inflation. We are determined to bring down inflation,” Karahan said in the interview, his first with the media since becoming central bank chief in February.
The central bank last Thursday kept its key interest rate unchanged for the sixth month in a row, with annual inflation recorded at over 50 percent in August.