Turkish Central Bank keeps year-end inflation projection of 38%

The Turkish Central Bank maintained its earlier inflation forecast for the end of the year. Governor Fatih Karahan stated that the bank expects domestic demand to continue weakening due to current monetary policy.

The Central Bank of the Republic of Türkiye (CBRT) forecasts that annual consumer inflation will reach 38% by the end of this year. This forecast was shared during the presentation of the bank’s third inflation report of the year.

The Central Bank has also kept its inflation estimates for the following years unchanged: 14% for next year and 9% for 2026, as previously announced.

“As we approach the end of the year, the forecast range for 2024 should have narrowed. However, due to increasing uncertainties from recent geopolitical events and global financial volatility, we have kept the forecast range between 34% and 42%,” Karahan said.

The governor highlighted recent measures taken by the bank to curb inflation, noting that Turkey has entered a period of disinflation. Since last year, the CBRT has raised its key policy rate to 50% from 8.5%, reversing the previous policy of lower rates.

The annual inflation rate dropped below 62% in July, marking a significant decrease from June and the lowest level recorded since October of the previous year.