Turkey’s Central Bank (CBRT) on Thursday revised up its year-end inflation forecasts for the next three years while keeping its medium-term target at 5%.
The annual inflation rate is projected to reach 18.4% by the end of 2021, up from its previous forecast of 14.1%, the bank’s governor told a meeting held to release the bank’s fourth quarterly inflation report.
The revision was mainly driven by higher import costs and food prices, Sahap Kavcioglu said.
“Recent increase in inflation has been driven by supply-side factors such as rise in food and import prices, especially in energy and supply constraints, rise in administered prices and demand developments due to the reopening,” he explained.
The bank’s year-end inflation forecast for the next year was 11.8%, revised from 7.8%, the governor said, adding the inflation is expected to hit 7% by the end of 2023 before stabilizing at 5% in the medium term.
According to the latest data from the Turkish Statistical Institute, Turkey’s annual inflation rate climbed to 19.58% in September.
The government, in its medium-term economic program, said annual inflation is projected to hit 16.2% by the end of 2021.
