Dogecoin Stock- POLL-Turkish inflation expected to exceed 15% in February
By Ezgi Erkoyun and Ali Kucukgocmen
ISTANBUL, Feb 26 (Reuters) – Turkey’s annual inflation is expected to rise to more than 15% in February, a Reuters poll showed on Friday, as fruit and vegetable prices continue to exert upward pressure.
In a Reuters poll of 16 economists, the median estimate for annual consumer price inflation in February was 15.39%, with forecasts ranging between 15.10% and 15.70%. It stood at 14.97% in January.
The median for the month-on-month rise was 0.7%, with forecasts ranging between 0.5% and 1%.
“The food group with its increased weight in the basket, especially fruit and vegetable prices, could exert upside pressure on February inflation,” said Serkan Gonencler, an economist at Gedik Yatirim.
Inflation is expected to peak at around 16% in April before falling gradually, Gonencler said, adding that a continuation of the recent weakness in the lira could add upside pressure.
“A policy rate hike could still come on the agenda if the recent lira weakening continues and negatively impacts the inflation path. We continue to think that the central bank could consider rate cuts in Q3 after a fall in the inflation print.”
The lira TRYTOM=D3 strengthened following the change of economic management in November, but was hit this week by surging U.S. bond yields that helped erase nearly all the year’s gains.
The central bank, which has repeatedly said it would target inflation more strongly under new governor Naci Agbal, has raised its policy rate by 675 basis points to 17% since November. The benchmark rate was held steady in January and February meetings.
The central bank expects inflation to come down to 9.4% by the end of 2021. However it said changes of weightings in the inflation basket will have an upside impact on annual inflation until mid-2021.
The central bank said the changes were projected to increase inflation by 0.5 points by April, then die out towards the end of the year.
In the Reuters poll, the median forecast of 14 economists for inflation at year-end stood at 10.90%, with estimates ranging between 10.00% and 12.00%.
The Turkish Statistical Institute is scheduled to announce February inflation data at 0700 GMT on March 3.
(Writing by Ezgi Erkoyun Editing by Daren Butler)
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