In Turkey, inflation is single-digit after 34 years

In Turkey, inflation is single-digit after 34 years

Turkey's inflation data was better than expectations in December. According to the data released by the State Institute of Statistics, wholesale price index (WPI) and consumer price index (CPI) rose by 0.13% and 0.45% respectively in December when compared with the previous month's results. Further, core inflation showed an increase of only 0.2% in the mentioned period. Accordingly, 2004 inflation rates regressed to 9.3% in CPI, 13.8% in WPI and 10.6% in core inflation. The 0.3% decline registered in the public sector manufacturing prices helped WPI increase decline. The decline in the public sector manufacturing prices was mainly driven by the 2.2% decline in the basic metal industry and the 1.6% decline in the price of chemical products as a result of the appreciation of Turkish Lira in December. On the CPI front, the lower than expected 0.8% increase recorded in food prices and the decline in clothing prices affected the CPI positively. The clothing prices declined by 0.5% in December after rising by 5.7% in October and by 2.2% in November. With these figures, CPI completed the 2004 at single-digit after 34 years. Under these circumstances, the successful disinflation process is expected to continue in 2005 as well.