Inflation puts pressure on households and businesses in most economies of the world. One country though, has linked its name to outrageous inflation.
The country is Turkey, where the consumer price index rose in October for the 17th consecutive month, reaching 85.51% year-on-year.
This is the highest rate since 1997, according to official data released today.
Food prices were 99 percent higher than the same period last year, housing prices rose 85 percent and transport rose 117 percent, the Turkish Statistical Office said Thursday.
The domestic producer price index showed a 157.69% year-on-year increase and rose 7.83% month-on-month. The monthly rise in consumer prices was 3.54%.
The dramatic rise in the cost of living for the country of 85 million has continued unabated for almost two years, alongside the significant depreciation of the Turkish currency.
If the lira does not weaken further, October’s inflation may be the ceiling, estimated Haluk Burumcekci of Burumcekci Consulting. “We believe inflation may have peaked unless there is a depreciation from the current level of the lira,” he said. “A significant decline (in inflation) could only happen towards the 70-75% range due to the base effect in the last month of the year.”
The 44% fall in the pound last year and 29% this year was the main reason behind the surge in inflation, apart from the rise in energy prices.
Another aspect of Turkey’s inflationary problem is the unorthodox policy of the country’s central bank, which, under pressure from Turkish President Recep Tayyip Erdogan, cut its key interest rate despite rising prices.
