Turkey annual inflation well above forecast near 58%

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ISTANBUL, Feb 3 (Reuters) – Turkish annual inflation fell to 57.68% in January, official data showed on Friday, well above forecasts despite a favourable base effect that is expected to carry on until President Tayyip Erdogan faces tight elections in May.

Month-on-month, consumer prices rose 6.65%, the Turkish Statistical Institute said, much higher than a Reuters poll forecast of 3.8%. Annually, consumer price inflation was forecast to be 53.5%.

Inflation hit a 24-year high of 85.51% in October, stoked by a series of unorthodox interest rate cuts that began in September 2021 and caused a currency crash late that year. The annual price measure is now easing relative to that run-up.

The domestic producer price index was up 4.15% month-on-month in January for an annual rise of 86.46% .

Turkey is set for better days now that a difficult period of inflation has passed, Finance Minister Nureddin Nebati said on Friday, after annual inflation in January fell further from an October peak, to near 58%, due to the so-called base effect.

“Current data shows the most difficult period is left behind in inflation and it will be so much better in the months ahead,” Nebati said on Twitter.

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