Istanbul’s annual inflation hits 105.6%

Istanbul’s annual inflation hits 105.6%
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The increase was led by household goods and food prices

Consumer prices in Turkey’s most populous city of Istanbul climbed by 105.6 percent year-on-year in November, the Istanbul Chamber of Commerce (ITO) said.

Month-on-month inflation rose by 3.1 percent, ITO said in its price index published on Thursday.

The increase was led by household goods and food prices.

The previous month, the retail prices in Istanbul increased to an annual rate of 108.77 percent.

Turkey’s inflation rate extended record highs in recent year, after central bank adopted a rate-cutting policy despite soaring prices.

Acting on the orders of Turkish President Recep Tayyip Erdogan who insists on low interest rates, the central bank since last autumn has lowered the benchmark one-week repo rate from 19 percent to 9 percent.

Erdogan says rate hikes are against his Islamic beliefs and insists that low interest rates lead to lower inflation, an opinion that jars with conventional economic theory that says higher interest rates slow inflation.

Turkey’s annual inflation accelerated to 85.5 percent in October from 83.5 percent in September, extending to a new 24-year high.

Annual inflation in October continued to rise for the 17th consecutive month, the official data published by the Turkish Statistical Institute (TUIK) showed.

However according to ENAG, a group of academics calculating consumer price inflation using similar criteria to TUIK, said that the real inflation climbed to 185.3 percent.