Turkey Faces Rates Impasse as Inflation Hits 20-Year High
- Annual CPI reached 48.7% in January, driven by energy costs
- Turkey paused an easing cycle last month as prices soared
Visitors at Taksim square in Istanbul in October, 2021.
Photographer: Moe Zoyari/BloombergThis article is for subscribers only.
Turkey’s inflation accelerated to its highest level since President Recep Tayyip Erdogan took power two decades ago, challenging a push for lower borrowing costs that’s battered the lira and hit his working class base ahead of next year’s elections.
Consumer price inflation surged to an annual 48.7% last month, the highest since April 2002, leaving the central bank in a tricky position where raising rates will anger Erdogan but cutting them will only add to runaway price increases.