Inflation in Turkey breaks 20-year record, almost 49%

February 3, 2022

ANKARA, Turkey (AP) — Turkey’s annual inflation hit nearly 49% Thursday, a 20-year high, as people found it harder to buy basic goods like food.

The consumer price index grew by just over 11% in January from the previous month, according to the Turkish Statistical Institute. The year-on-year increase in food prices exceeded 55%, according to official data.

The inflation rate was the highest since April 2002, in a country plunged into an economic and monetary crisis triggered by a series of interest rate cuts.

President Recep Tayyip Erdogan has declared himself an “enemy” of high interest rates, insisting that they cause inflation, a position that contradicts mainstream economic thinking.

The Turkish central bank has cut rates by 5 percentage points since September, to 14%, before halting them in January.

Erdogan promised this week that his government will “reduce the spiral of high inflation every month” and eliminate it altogether “after some time.”

Opposition parties have questioned the independence of the Turkish Statistical Institute and contested the data. The Inflation Research Group, an independent group, estimates Turkish real inflation at 114.87% year-on-year.

Erdogan replaced the head of the statistical agency last week. No reason was given for the change.