The Turkish Central Bank today revised its year-end inflation forecast to 8.9% for 2020, up from 7.4%. The Bank also forecast an inflation rate of 6.2% for 2021.
In his presentation of the Bank’s 2020-III Inflation Report, July 29th, 2020, Central Bank Governor Murat Uysal indicated that “despite the restraining effects of aggregate demand conditions, pandemic-related rise in unit costs have led to an increase in the trends of core inflation indicators”. Despite raising the inflation forecast after three months of price rises through the pandemic, he remained optimistic a downtrend would begin as soon as this month. Uysal
downplayed concerns about the bank’s depleted reserves, and said that the new forecast made no assumption about a second coronavirus wave. He added that the pace of economic recovery from the pandemic will depend on normalisation steps and containment measures are expected to shrink the economy this year. The annual inflation rate as of June 2020 was 12.62%.