The prices of energy, food, and basic products made the most significant contributions to the surge in inflation in March, according to the Price Developments Report, prepared by the Central Bank. The report, where the bank interpreted March inflation data, also found that the increase in commodity prices has been exacerbated by geopolitical developments.
Here are the statements made by the Bank in the summary of the report:
“Consumer prices rose by 5.46% and the annual inflation surged by 6.70 points to 61.14%. The surge in the annual consumer inflation expanded across subgroups and the energy, food, and basic products groups made the most significant contribution to this development. The upward trend observed in commodity prices since the beginning of the year was exacerbated in this period with geopolitical developments.”
“Domestic energy prices were affected by the outlook of international energy prices in TRY, while the regulation in the gradual tariff system for electricity prices and the Value-Added Tax (VAT) reduction limited a more negative potential outlook. The surge in annual food inflation continued across subgroups, fresh fruit and vegetable prices, which were previously increasing on a monthly basis, had a relatively stable course in March. Moreover, the delayed impacts of the VAT reduction in food subgroups were also observed.”
“The annual inflation in basic goods stayed on a steady course course in the clothing and footwear group but increased in other subgroups. Annual inflation in the services group rose across all subgroups. Transportation, restaurants, and hotels continued to be outstanding due to the increases in energy and food prices in this period. The hike in producer prices continued as a result of the ongoing strong increase in international commodity prices and interruptions in supply chains. Under these conditions, the surge in annual inflation of B and C indicators continued.”