In Turkey, CPI reaches the lowest level of last 37 years
Data released by Turkish Statistics Institute (TUIK) show that the country's consumer price index (CPI) increased 0.42 percent month on month in December 2005 compared to market expectations of 0.6 percent. On the other hand, producer price index (PPI) fell 0.04 percent month on month.
Year-end CPI inflation remained at 7.72 percent, below the official target of 8 percent. In addition, consumer prices recorded the lowest level in 2005 after the 0.53 percent increase reported in 1968.
Year-end PPI figure showed a rise of 2.66 percent in 2005.
On the CPI front, food and non-alcoholic beverage prices fell 0.3 percent month on month in December, indicating that strong price adjustments in this subgroup have already been worked out through October-November 2005. Furthermore, clothing prices fell 0.59 percent. Transportation prices decreased 0.18 percent month on month. This may reflect either the impact of decline in retail fuel prices as a result of the drop in crude oil prices and strengthening currency.
On the PPI front, the impact of the strong currency has been felt much stronger along with the decline in crude oil prices. The 1.7 percent increase in wholesale food prices was more than offset by the 0.5 percent decline in
manufacturing prices.
The inflation target for 2006, 2007 and 2008 is at 5 percent, 4 percent and 4 percent respectively.