What matters on Thursday, February 3

The Turkish Statistical Institute (TurkStat) released the hotly anticipated inflation data for the first month of the year. The annual inflation rose by 48.69%, while the Consumer Price Index (CPI) increased monthly by 11.10% in January. Thus, the figure hit a 20-year high in line with the market expectations.

The cumulative TRY devaluation, minimum wage increases, rising energy prices, and the Special Consumption Tax (SCT)- driven price surge in tobacco and alcohol beverages have paved the CPI to reach these levels, according to the economic world.

Moreover, Tera Yatirim Chief Economist Enver Erkan says the increase also stemmed from the surge in global commodity prices, increasing pressure on producer costs, and other price increases in public services with the ‘administered/directed prices’ fact although foreign exchange (FX) rates have had a lower course since the end of December 2021. “Inflation poses a risk to increase the pressure on FX rates at the inflationist point and keep alive the FX demand to protect savings from inflation, as inflation will continue to further deepen the inflation-adjusted return of the Turkish assets in the negative zone,” Erkan added.

In the meantime, the Central Bank estimates the inflation to end 2022 at 23.2% and the annual inflation to reach around 50%. Tera Yatirim’s year-end inflation is 36.7% for 2022 under current conditions.

The share of foreigners on Borsa Istanbul fell below 40% to 39.97% for the first time yesterday. Short-term outflows and inflows by foreign investors can be observed, however, fundamental changes should happen for their long-term position as it was in previous years, according to analysts. On the other hand, the transaction volume on the stock exchange has declined in the recent weeks. It has fallen to TRY 31bn as of previous day, according to the Central Bank.

President Recep Tayyip Erdogan visits Ukraine today upon the invitation of his counterpart to attend the 10th meeting of the High-Level Strategic Council between the two countries.Erdogan and Volodymyr Zelensky will review the two countries’ relations, which are at the level of strategic partnership, according to the Communications Directorate. At the meeting to be held in the capital Kyiv, the two leaders, will discuss possibilities for further deepening cooperation and exchange views on regional and international issues, as well as bilateral ties. The two sides are also expected to sign various agreements and memorandum of understanding.​​​​​​​


The annual inflation rose by 48.69%, while the Consumer Price Index (CPI) increased monthly by 11.10% in January, according to TurkStat.

The domestic producer price index (D-PPI) jumped 93.53% in January compared to the same month of the previous year, according to TurkStat. D-PPI climbed by 10.45% on a monthly basis.

The Central Bank will hold an Extraordinary General Assembly meeting.

The Central Bank and the Banking Regulation and Supervision Agency (BDDK) will release weekly money and banking statistics (2.30 pm).


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