We begin in Turkey where the country’s Central Bank is predicting a slower Pace to Rising prices in 2023.
It’s now forecasted inflation rate of 22 percent for the year analysts however still expect the rate to stay well above that projection the official figure for inflation standing at 65 percent at the end of last year after hitting a record high of 85 percent in October Rising prices have sparked a cost of living crisis in Turkey just days ago president Erdogan said the country will hold new elections on May 14th all right for more on this I’m joined by my colleague here in studio Akram you.
And I have talked about this number of times inflation in Turkey a constant theme but a very serious one nonetheless this prediction of 22 when we saw 85 are the official figures what should we make of that well we should probably ask the Central Bank president himself because this seems to be an overestimation at best and this also means in Practical terms that turkey ended the year with 65 inflation rate.
So that means that you foresee a 40 decrease in one year it’s just official right and that’s just official we have also talked about as you remember the other academics and research groups what they say about Turkish inflation which is at least two-three times higher than official figures.
But let’s stay with the official figures and let’s say in Turkey in such a global economic landscape the inflation will fall over 40 percent in one year well this needs a lot of explaining to do why it’s Central by the president we’ve um we’ve also talked about Erdogan’s insistence on cutting interest rates to boost growth and he said that even this would help lower inflation rates what we’ve seen the opposite.
We’ve seen the inflation rates have gone higher and higher and higher if we’re now predicting a 22 official inflation does this suggest that maybe he will then revert back to conventional thinking on this and that maybe there won’t be continued cutting of inflation rates interest rates sorry well there is so far no indication for that but what we remember is that at the end of 2022, the Central Bank president said.
We have ended the cycle of cutting rates so the interest rate basic interest policy rate is nine percent right now it came from 19 in one year and uh well there’s another thing at stake right now the Turkish elections which are going to be held on 14th of May and we are now entering into an election economy rather than a usual economy you can consider this foreign as a wartime economy.
So if you look at Turkey there’s an enormous spray of public spending the age limit for retirement has been abolished so a lot of people will get their retirement premium pensions right yes and um there’s a lot of cash aids to low-income families and everyone is doing everything with public spending right now to win the hearts and minds of the people because the elections are very very critical for him.
And one more thing to add to this we will see the effects of this of all of these rate cuts and the enormous public spending and the quarter tree or quarter two so um you know in the light of all this picture this prediction of Central Bank presidents um like I said, in the beginning, it’s at best it’s an overestimation and wishful thinking all right akramekichi DW business thank you very much