Fuelled by an experimental central bank policy that has chased away foreign investors and eroded the lira’s value, Turkish inflation probably accelerated last month to a level last recorded in mid-1998.
Annual inflation probably rose to 83.5 per cent in September, climbing for a 16th month, according to the median estimate in a Bloomberg survey.
The jump comes at a time when central bank chief Sahap Kavcioglu has embarked on a series of interest rate cuts this year, making Turkey an outlier among global monetary authorities, most of which are aggressively tightening to control price increases.
Turkey’s central bank said in its latest forecast in July that inflation should peak somewhere between 80 per cent and 90 per cent by October. The government estimates that it will slow to 65 per cent at the end of this year.
However, President Recep Tayyip Erdogan has insisted on even lower interest rates, saying that they will help to reduce inflation, an argument that contradicts conventional economic theory — and which, so far, hasn’t been validated by real-world experience, least of all in Turkey.
He has called for the benchmark rate to be cut to below 10 per cent by the end of the year, from 12 per cent currently.
“Further rate cuts will inevitably lead to more currency depreciation and higher inflation,” Morgan Stanley economists, including Alina Slyusarchuk, said in a report last week.
Turkish officials reject criticism that rampant price increases are a result of monetary policy errors, instead blaming Russia’s invasion of Ukraine for a global rally in commodities including energy and food.
Yet, even when the impact from such volatile items is excluded, annual Turkish inflation stood at more than 66 per cent as of August, according to a core price index published by state statistics agency TurkStat.
“Price gains are high, broad-based and likely to be persistent. Items with triple-digit inflation accounted for 25 per cent of the consumer basket,” Bloomberg economist Selva Bahar Baziki said.
“Recent and forthcoming interest rate cuts will likely result in even higher inflation in the coming months.”
The experimental policies have already pushed inflation above 100 per cent in parts of the country. Consumer prices in Istanbul, Turkey’s most populous city, more than doubled from a year earlier, according to a retail price index — compiled by the Istanbul Chamber of Commerce — released on Saturday, before the national data on Monday.
A breakdown of the Istanbul data showed the cost of everything from rent to food rose sharply last month. Attempting to ease the pain for poor Turks before elections scheduled for next June, the government has raised the national minimum wage twice in a year.
Mr Kavcioglu has delivered cuts, as sought by Mr Erdogan, at the last two rate-setting meetings, slashing the benchmark by 100 basis points each time.
That has left Turkey with the world’s deepest negative interest rates when adjusted for inflation, while the lira has lost more than 50 per cent of its value against the dollar in the past 12 months.
Real estate tokenisation project
Dubai launched the pilot phase of its real estate tokenisation project last month.
The initiative focuses on converting real estate assets into digital tokens recorded on blockchain technology and helps in streamlining the process of buying, selling and investing, the Dubai Land Department said.
Dubai’s real estate tokenisation market is projected to reach Dh60 billion ($16.33 billion) by 2033, representing 7 per cent of the emirate’s total property transactions, according to the DLD.
SPECS
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Killing of Qassem Suleimani
MATCH INFO
World Cup qualifier
Thailand 2 (Dangda 26', Panya 51')
UAE 1 (Mabkhout 45 2')
Global state-owned investor ranking by size
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United States
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China
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UAE
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Japan
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Norway
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Canada
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Singapore
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Australia
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Saudi Arabia
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South Korea
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What vitamins do we know are beneficial for living in the UAE
Vitamin D: Highly relevant in the UAE due to limited sun exposure; supports bone health, immunity and mood.
Vitamin B12: Important for nerve health and energy production, especially for vegetarians, vegans and individuals with absorption issues.
Iron: Useful only when deficiency or anaemia is confirmed; helps reduce fatigue and support immunity.
Omega-3 (EPA/DHA): Supports heart health and reduces inflammation, especially for those who consume little fish.
Biog
Age: 50
Known as the UAE’s strongest man
Favourite dish: “Everything and sea food”
Hobbies: Drawing, basketball and poetry
Favourite car: Any classic car
Favourite superhero: The Hulk original
Ticket prices
- Golden circle - Dh995
- Floor Standing - Dh495
- Lower Bowl Platinum - Dh95
- Lower Bowl premium - Dh795
- Lower Bowl Plus - Dh695
- Lower Bowl Standard- Dh595
- Upper Bowl Premium - Dh395
- Upper Bowl standard - Dh295
The specs
Engine: 2.0-litre 4-cylturbo
Transmission: seven-speed DSG automatic
Power: 242bhp
Torque: 370Nm
Price: Dh136,814
More from Neighbourhood Watch:
WHAT IS A BLACK HOLE?
1. Black holes are objects whose gravity is so strong not even light can escape their pull
2. They can be created when massive stars collapse under their own weight
3. Large black holes can also be formed when smaller ones collide and merge
4. The biggest black holes lurk at the centre of many galaxies, including our own
5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed
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Killing of Qassem Suleimani
Killing of Qassem Suleimani
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
The biog
Title: General Practitioner with a speciality in cardiology
Previous jobs: Worked in well-known hospitals Jaslok and Breach Candy in Mumbai, India
Education: Medical degree from the Government Medical College in Nagpur
How it all began: opened his first clinic in Ajman in 1993
Family: a 90-year-old mother, wife and two daughters
Remembers a time when medicines from India were purchased per kilo
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%3Cp%3EAuthor%3A%20Michael%20Knights%3C%2Fp%3E%0A%3Cp%3EPages%3A%20256%3C%2Fp%3E%0A%3Cp%3EAvailable%3A%20January%2026%3C%2Fp%3E%0A
