Elvan: Turkey will never compromise on measures to fight inflation

Turkey’s Finance Minister Lutfi Elvan has said January’s inflation figures are far from the country’s targets, stressing that the government will never compromise on measures to fight the inflation.

"We will act with consultation mechanisms that include all parties. Sustainable growth is not possible without achieving price stability," Elvan said on Twitter on Wednesday.

Turkey posted a 14.97 percent annual rise in consumer prices in January, the country’s statistical authority announced Wednesday.

The annual figure was up 0.37 percentage point last month, rising from 14.60 percent in December 2020, according to the Turkish Statistical Institute (TurkStat).

Turkey's Central Bank on Tuesday submitted an open letter to the government explaining why annual inflation was higher compared to the country's target range last year.

READ MORE: IMF forecasts six percent GDP growth for Turkey in 2021

Inflation forecasts

Liquidity measures taken to contain the adverse effects of the novel coronavirus pandemic, as well as credit expansion, were among the main culprits, the bank said.

It also stressed that even though consumer inflation was restrained by weak demand for goods and services amid the pandemic, inflation remained up in categories where the pass-through from credit and exchange rate developments were relatively high.

Last week, the bank kept the country's year-end inflation forecasts unchanged at 9.4 percent this year and 7 percent next year.

The inflation rate will fluctuate between 7.3 percent and 11.5 percent through the end of this year, the bank's governor told a virtual meeting held to release the bank’s first quarterly inflation report of the year.

Inflation is projected to stabilise around 5 percent by 2023, said Central Bank of Turkey chief Naci Agbal, adding that tight monetary stance will be resolutely maintained until the target is reached.


READ MORE: OECD revises up Turkey’s growth forecast for 2020