Annual inflation in Türkiye eases to 35.4 percent in May
ANKARA
Türkiye's annual inflation was at 35.41 percent in May, down from 37.86 percent in April, official figures from the Turkish Statistical Institute (TÜİK) showed on June 3.
Annual inflation, which has decreased by 40 points in the last 12 months, fell to its lowest level since November 2021, Finance Minister Mehmet Şimşek said on X, commenting on the latest numbers.
Goods inflation was 28.7 percent, the lowest in the last three and a half years, he noted.
Due to the steady decline in inflation and improvement in expectations, services inflation also decreased by 45 points compared to the previous year, falling to 51.2 percent, the minister said, noting that this rate is the lowest level seen after June 2022.
“As a result of our policies that we implement with determination, predictability, financing opportunities and the investment environment will improve, productivity will increase, and welfare will increase with sustainable high growth, along with ongoing disinflation,” said Şimşek.
The market expected the annual inflation to come in at 36.1 percent and monthly inflation at 2 percent for the last month.
Consumer price index (CPI) increased by 35.41 percent annually and 1.53 percent monthly, down from 3 percent in April, said TÜİK.
Food and non-alcoholic beverage prices declined 0.71 percent month-on-month for an annualized increase of 32.9 percent.
Housing costs in the country rose by 2.99 percent monthly and 67.43 percent annually, according to the statistics institute.
TÜİK data revealed that the highest annual price increases were in education at 71.67 percent, housing and health at 40.12 percent.
The lowest annual increases were observed in clothing and footwear at 14.12 percent, communications at 19.25 percent and transport at 24.59 percent.
Last month, the Central Bank kept its inflation forecast for 2025 at 24 percent, while leaving its end-2026 forecast unchanged at 12 percent.
The bank’s inflation target for 2027 is 8 percent and 5 percent in the medium term.
The Central Bank will maintain the decisive monetary policy stance and act to ensure the continuation of the disinflation process, said Governor Fatih Karahan on May 22, representing the bank’s quarterly inflation report.
As inflation further slowed in May, all eyes will be on the Central Bank’s Monetary Policy Committee, which will meet on June 19 to decide on the interest rates.
On April 17, the bank raised the policy rate, the one-week repo auction rate, from 42.5 to 46 percent. It also increased the overnight lending rate from 46 to 49 percent, and the overnight borrowing rate from 41 to 44.5 percent.
