ISTANBUL – Turkey’s annual inflation rate accelerated to 85.51% in October, its highest level since 1997, official data showed today, as President Recep Tayyip Erdogan has defended unorthodox policies to combat a cost-of-living crisis.
Central banks worldwide are raising borrowing costs in efforts to tame soaring consumer prices, but Turkey has bucked the global trend, with Erdogan calling higher interest rates his “biggest enemy”.
Last month, Turkey’s central bank cut its policy rate for a third consecutive time, bringing it down to 10.5% percent from 12%.
With an election looming next year, Erdogan argues that high interest rates are the cause of inflation, not the opposite, in defiance of orthodox economic theories.
Consumer prices reached 83.45% in September.
Yesterday, Erdogan praised the state of economy, in an address to his ruling AKP lawmakers in the Parliament.
“Thank God, the wheels of the economy are turning,” he said.
“Our economic model, which we have summarised as growth through investment, employment, production, export and current account surplus, is bearing fruit.”
Many Turks question the credibility of the official government data.
According to a respected monthly study released by independent economists from Turkey’s Enag research institute, the annual rate of consumer price increases reached 185.34% in October. – AFP, November 3, 2022
