Turkish President Recep Tayyip Erdoğan
Photo: Adem Altan / AFP
High inflation in Turkey continues to rise.
In September, consumer prices were 83.5 percent higher than a year earlier.
This is reported by the national statistical office in Ankara.
Analysts had even expected a slightly higher inflation rate.
Inflation had already amounted to around 80 percent in the previous month.
On a monthly basis, consumer prices rose by a good three percent in September.
The development of food prices, which hits financially weak households hard, is particularly strong.
They have increased by a good 93 percent.
The producer prices show how strong the price pressure is on the upstream economic levels.
In September they rose by around 151 percent compared to the same month last year.
Producer prices are therefore more than twice as high as a year ago.
Producer prices affect the consumer's cost of living indirectly and with a time lag.
The high inflation is driven by several factors.
The weak national currency, the lira, has been driving up prices for a long time since it makes goods imported into Turkey more expensive.
In addition, there are ongoing problems in the international supply chains, which make preliminary products more expensive.
In addition, the prices of energy and raw materials are rising, mainly because of the Russian war against Ukraine.
Central bank does not take countermeasures
In contrast to many other central banks, the Turkish central bank is not fighting the escalating inflation by raising interest rates.
In fact, it has recently lowered its key interest rate several times.
Experts recognize political pressure on the central bank in this behavior.
President Recep Tayyip Erdoğan is a declared opponent of high interest rates and recently called for further interest rate cuts.
At the end of the week, the rating agency S&P lowered the country's creditworthiness in view of the high inflation and the currency crisis.
The long-term foreign currency rating is no longer "B+" but "B".
As a result, Turkey is slipping deeper and deeper into the junk area, in which investments are considered highly speculative.
The US agency announced on Friday that the outlook was stable.