More inflation pain ahead for Turkey

LONDON:

Wall Street banks predicted on Monday more price pressures ahead for Turkey after the country reported annual inflation rates climbing to a 20-year high of 61.14% in March. JPMorgan predicted Turkey’s annual inflation would hover in the 65-70% range until the very end of the year when it could fall to 44% due to strong base effects. “The CBRT (Turkey central bank) has put all its emphasis on the forex-protected deposit scheme and is unlikely react to the CPI data no matter how strong it is,” said Yarkin Cebeci at JPMorgan in a note to clients. Goldman Sachs forecast inflation to peak around 67% in May-June and remain above 65% for most of 2022, though it will end the year at 45%. “We also see upside risks from commodity prices and the monetary policy stance, which is not geared to fighting inflation,” Murat Unur at Goldman Sachs wrote in a note to clients.

Published in The Express Tribune, April 5^th, 2022.

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