Inflation rises to 16.1% in Turkey, the highest in 20 months

Istanbul, Apr 5 (EFE) .- Inflation in Turkey rose 3% in March compared to the previous month, reaching 16.1%, the highest rate in the last twenty months, as reported by the Institute of Statistics on Monday Turkish (Türkstat).

The highest price increases have been registered in the transport sector, which has become more expensive by 23.6%, while alcoholic beverages and tobacco have experienced the smallest increase, 2.8%.

On the other hand, the producer price index (PPI) increased 4.13% compared to February and accumulates an annual increase of 31.2%.

The Turkish lira has depreciated so far this year by 5.6% against the euro and 8.74% against the dollar.

The president of the Central Bank, Sahap Kavcioglu, declared last Thursday that interest rates will not be raised and promised a “strict monetary policy”, without giving further details.

Kavcioglu was appointed two weeks ago by Turkish President Recep Tayyip Erdogan after firing by decree the former head of the Central Bank, Naci Agbal.

According to analysts, this substitution was due to Agbal increasing basic interest rates in Turkey by two percentage points, contrary to Erdogan’s heterodox position that increases in the price of money generate more inflation.

Agbal’s replacement, announced on a Saturday, caused the lira to plummet 15% and the stock market 9% when markets opened the following Monday.

Although the tension continued in the days after, the currency has partially recovered since then.

(c) EFE Agency