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Market in Izmir, Turkey
Photo: Aedil Toffolo / Cover Images / IMAGO
Inflation in Turkey continues to rise.
In October, consumer prices were 85.5 percent higher than a year earlier, according to the National Bureau of Statistics in Ankara.
In the previous month, inflation was 83.4 percent.
For comparison: Germany experienced a 10.4 percent increase in consumer prices in October.
On a monthly basis, consumer prices in Turkey rose by 3.5 percent in October.
Prices in the country have been rising sharply for about a year.
At the end of 2021, inflation was only around 20 percent.
Producer prices, which rose by 157.7 percent year-on-year in October, show how strong the price pressure is at the moment.
The producer prices capture the prices at the producer level.
The annual rate of producer prices is more than double what it was a year ago.
Producer prices affect the consumer's cost of living indirectly and with a time lag.
Central bank cuts key interest rate again - despite high inflation
In Turkey, high inflation is being 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.
In contrast to many other central banks, the Turkish central bank is not fighting the galloping inflation by raising interest rates.
Instead, the interest rate was recently reduced by 1.5 percentage points to 10.5 percent.
The majority of economists had expected a reduction to just 11.0 percent.
It was the third rate cut in a row.
Turkish President Recep Tayyip Erdoğan is a staunch opponent of high interest rates.
The 68-year-old had previously put pressure on the central bank several times (read here how Erdogan's actions fuel inflation).
bam/dpa