Inflation in Turkey drops below 40% in May as Erdogan forms economic team
As Turkey’s annual inflation eases further in May, eyes are on the policies the reelected president's new economic team will pursue with Mehmet Simsek at the helm.
Turkey’s year-on-year inflation dropped to 39.59% in May, official data released on Monday showed, broadly in line with expectations after the government made natural gas free to offset price rises.
Consumer prices increased 0.04% from a month earlier, the data showed.
The country’s high inflation and an acute cost-of-living crisis pose major challenges for Turkish President Recep Tayyip Erdogan’s newly formed government, with local elections only 10 months away. Erdogan, who adamantly pursued a policy of cutting interest rates to boost economic growth despite a plunge in the Turkish lira and soaring prices, signaled a departure from his unconventional economic policy on Saturday by tapping Mehmet Simsek, a former economic czar who enjoys international credibility, as his new finance and treasury minister.
Turkey’s consumer inflation hit a 24-year high of 85.5% late last year before easing in the ensuing months, largely due to a favorable base effect stemming from lower annual price increases in comparison to the respective previous periods.
