Turkey: Inflation rises in June
Consumer prices rose 1.13% in June over the last month, coming in below May’s 1.36% rise. June’s result came on the back of falling prices for food and non-alcoholic beverages, as all other categories saw prices increasing over the prior month.
Inflation increased to 12.6% in June, up from May’s 11.4%. June’s figure represents the highest inflation rate since August 2019. Meanwhile, the trend pointed down mildly, with annual average inflation coming in at 11.9% in June (May: 12.1%). Core inflation rose to 11.6% from May’s 10.3%.
The recent uptick in inflation has likely been influenced by the depreciation of the Turkish lira since the tail end of the first quarter. As the economy has begun to reopen, firms likely passed on higher cost burdens to consumers. Going forward, as economic activity is set to weaken notably over the year as a whole, inflation is expected to moderate. Upside risks remain present, however, in the form of potential supply-chain disruptions.