Turkish Inflation Peaks

It seems like Turkish CPI peaked in July at 12.1% and went down to 11.8% in August. In the next three months it is very likely that inflation rate will go below 10% and stay in single digits in 2009. The sharp decline is supporting the decline in inflation rates. Last year in September m-o-m CPI was 1%, in October it was 1.8%, and in November it was 2%. This year, we might experience a higher inflation in September because of Ramadan effect, but I don't think it is very likely.

I mentioned at Ekonomi Turk in July that oil prices will decline towards the $100 mark. I don't think we will see a significant increase in oil prices for the remainder of the year. Thus, it is now very likely that we will see single digit inflation rates at the end of the year.