Inflation in Turkey in May slowed to the lowest since December 2021

According to the Statistical Institute of Turkey (Turkstat), the growth rate of consumer prices in May slowed for the seventh month in a row – to the lowest since December 2021.

Inflation in May was 39.6% compared to 43.7% in April. Analysts on average expected an even more significant weakening – up to 39.2%.

Experts note that the slower price growth is due to the election promise of President Recep Tayyip Erdogan. He said that the population will be able to receive gas for free during the year without volume restrictions.

The cost of food and soft drinks increased by 52.5% in May (53.9% in the previous month), which is the minimum increase in 17 months. Alcoholic beverages and tobacco products rose in price by 30.1% (in April – by 38.2%), utilities and housing payments – by 20.7% (by 43.2%), transport services – by 23.7% (by 25.6%).

At the same time, the rate of increase in prices for health services increased to 66.9% (compared to 66.6% in April), for educational services – to 50.9% (from 44.1%). The cost of staying in hotels and visiting restaurants and cafes also increased – from 66.4% to 69%.

Core inflation (consumer prices excluding food and energy prices) increased by 46.6% in May after rising by 45.5% a month earlier. At the same time, producer prices (PPI index) increased by 40.8% year-on-year compared to 52.1% in April.