Turkey Scraps Inflation Target in Face of Energy Price Shock

Turkey’s central bank sharply raised its inflation forecast on Thursday due to surging energy costs but didn’t signal a shift in monetary or exchange-rate policy despite mounting pressure on prices.

Governor Fatih Karahan said the bank is now targeting a year-end inflation rate of 24%, up from the previous 16%. The revision to the rate, which policymakers use to determine the interest-rate path, indicates a need to maintain a restrictive stance to bring still-high inflation under control.