According to the government’s shared data, the annual inflation of Turkey accelerated to a 19-years high in December driven by the Lira slumps clouding the consumer’s price outlook.
Through last month, the annual inflation rate climbed to 21.31% from 19.89% in October. The downfall was 20% faster than the estimated median time by the Bloomberg survey of analysts. As compared to other separate surveys the inflation is 3.51% from the estimated 3% inflation rate.
The Lira is now at the exchange rate of 1.4% after this week’s release, closing on the record as low as 13.95 US dollars.
The annual consumer rate of inflation ballooned up to 36% in December, according to the data shared by the Turkish Statistical Institute. This is the highest point since September 2002.
The 14% inflation has marked the seventh consecutive month of Lira downfall and increase of inflation in Turkey. This ultimately raised the annual price of necessities such as food and drinks and transportation even faster compared to last year. According to the data, inflation has caused an increase of 44% on food & drinks and 54% on transportation.
The crashing records continue to knock Lira this Monday, closing on almost 14 Liras for one dollar which is the lowest value seen since 2021.
The switch has warned many individuals to shift their savings to different strong currencies such as dollars and euros.
The acceleration affects Turkey’s benchmark interest rate badly with a negative 6.3% which is among the lowest interest yields in the developing markets.
However, President Recep Tayyip Erdogan has continued to follow his monetary policies despite controversies and objections from the public and experts.
Although, the economic crises have been seen globally as Turkey is not the only one suffering from surging inflation and increased prices. After the pandemic challenges and the demand-supply gap, many countries show a downfall on the chart.