Data published by the Turkish Statistical Institute showed that price growth accelerated in December and was the highest since 2002, due to the collapse of the lira.
According to the report, in December the consumer price index rose by 36.08% per annum after an increase of 21.31% per annum in November. Economists had expected a 30.4% increase. The acceleration of price growth was associated with an increase in the cost of food and beverages (+43.8% per annum) and transportation costs (+53.66% per annum).
On a monthly basis, consumer price growth accelerated to 13.58% from 3.51% in November. Economists had expected a 9% increase.
In 2021, the Turkish lira fell by 44% against the US dollar - the worst year for the lira in almost two decades - amid policy easing by the Central Bank under pressure from the country's president, who is a supporter of lower rates. Economists warn that if the Central Bank does not change the direction of its policy, inflation may continue to rise.
Separate data showed that in December the producer price index increased by 79.89% per annum compared with an increase by 54.62% per annum in November. Energy prices increased by 122.76% per annum, while the cost of intermediate goods increased by 92.13% per annum.
On a monthly basis, producer price growth accelerated to 19.08% from 9.99% in November.