Country Report Turkey January 2011

Economic performance: Inflation cools off in November as food prices fall

In November the consumer price index (CPI) rose by just 0.03% month on month and by 7.3% year on year, down from an annual rate of increase of 8.6% in October and 9.2% in September. The main reason for the deceleration in November was the partial reversal of the surge in food prices, which pushed the CPI higher in September and October. Prices of food and non-alcoholic beverages declined by 1.9% month on month, although they remained 12.4% higher than in November 2009. Price inflation in most other categories remained subdued in November 2010, reflecting spare capacity, increased competition and an earlier appreciation of the lira. Clothing and footwear prices rose by 3.9% month on month, but this was purely a seasonal increase; on a year-on-year basis they were up by only 3.7%. Prices of alcoholic drinks rose by 16.2% month on month owing to a tax increase.

(% change year on year, unless otherwise indicated)
 2009 2010          
Consumer prices (2003=100)
 % change month on month1.
Food & non-alcoholic beverages7.49.39.414.811.
 % change month on month2.
Clothing & footwear2.
 % change month on month4.6-2.8-8.2-5.30.410.611.20.4-5.2-4.8-
Housing, water, electricity, gas & other fuels1.
 % change month on month0.
Household goods-1.8-2.7-1.7-
 % change month on month-0.7-0.40.7-0.1-
 % change month on month1.3-
Producer prices (1997=100)
 % change month on month1.
Source: Turkish Statistical Institute (Turkstat).

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