Physical Address
Indirizzo: Via Mario Greco 60, Buttigliera Alta, 10090, Torino, Italy
Türkiye’s annual inflation climbed in September for the first time in more than a year, as sharp increases in food and education costs pushed consumer prices above expectations, official data showed on Friday.
Consumer prices rose 33.29% last month from a year earlier, up from 32.95% in August, the Turkish Statistical Institute (TurkStat) said. The unexpected acceleration raises fresh questions over the pace of interest rate cuts by the central bank.
On a monthly basis, the consumer price index (CPI) jumped 3.23%, exceeding the 2.6% forecast in surveys, which had also expected the annual rate to dip to 32.5%. In August, monthly inflation was 2.04%.
Last month marked the first rise in the annual rate since a peak of 75.4% in May last year.
Vice President Cevdet Yılmaz and Treasury and Finance Minister Mehmet Şimşek both acknowledged that September’s inflation exceeded forecasts but maintained that the underlying trend still points toward disinflation.
Yılmaz and Şimşek said food prices, driven by frost and drought, and the education category were the main factors behind the high reading.
“Although annual inflation temporarily increased due to developments specific to September, our fight against inflation continues decisively within the framework of our (medium-term) economic program,” Yılmaz wrote on Turkish social media platform NSosyal.
Food, housing, education main drivers
Annual CPI was pushed up by a 36.1% rise in prices of food and nonalcoholic drinks and a 51.4% rise in housing, the two categories with the highest weighting. Education costs surged 66.1% year-over-year, marking the steepest rise among key categories.
On a monthly basis, food and drinks prices shot up 4.6%, while the education category soared by 17.9%, an increase largely tied to the reopening of schools, the data showed. Housing costs increased 2.56% and transportation climbed 2.81%, TurkStat said.
“Food inflation caused by agricultural frost and drought exceeded the long-term September average by 3 percentage points and contributed 1.1 points to monthly inflation,” Şimşek wrote on social media platform X.
Education and related items added around 0.7 percentage points with the start of the school year, he added.
Yılmaz said temporary pauses may occur in the disinflation process due to cyclical developments or seasonal effects, stressing that the government does not expect any deviation from the main framework and direction of its medium-term program.
“We will continue to implement our comprehensive program, consisting of monetary and fiscal policies along with structural reforms, in a determined and coordinated manner,” he said.
“With the support of supply-side policies, especially in food and social housing, we aim to reduce inflation below 20% in 2026 and to single-digit levels in 2027.”
Underlying price pressures ease
“The underlying trend in inflation signals that disinflation will continue. As temporary effects diminish and with the supply-side policies we are implementing, we will ensure that disinflation, our (medium-term) program’s main priority, continues,” Şimşek said.
According to TurkStat, core inflation, measured by the B index excluding energy, food, beverages and gold, rose 32.86% in September from a year ago. That was down from 33% in August.
The domestic producer price index rose 2.52% month-over-month in September for an annual rise of 26.59%.
The Central Bank of the Republic of Türkiye lowered its benchmark policy rate by 250 basis points to 40.5% in September for the second consecutive month, and has signalled it may slow the pace depending on inflation dynamics.
That rate cut, and its 300-point reduction in July, were a bit more aggressive than analysts had expected.
Jason Tuvey, emerging markets economist at London-based Capital Economics, said the rise in headline inflation last month may provide some cause for caution at the central bank.
“For now, though, we think that the further easing of underlying price pressures will give officials enough confidence that they can press ahead with additional 250bp (basis point) rate cuts at its forthcoming meetings,” he said in a note.
The Turkish lira held steady at 41.685 to the U.S. dollar after the data. Bank stocks slipped.
The central bank returned to an easing cycle in July after having reversed course temporarily due to market volatility in March following the arrest of Istanbul Mayor Ekrem Imamoğlu on graft charges.
It had raised its policy rate to 46% in April. Before that, it began a gradual easing in December as inflation retreated.
Ahead of the CPI data, Morgan Stanley had said that, barring significant upside surprises, it expected the central bank to continue rate cuts but to reduce their size to 200 basis points this month.
