Despite President Recep Tayyip Erdogan’s promises to contain rising prices, with less than a year to go before the presidential election, soaring energy prices, linked to the conflict in Ukraine and the weakness of the Turkish lira are cutting sharply the purchasing power of the Turks.
Inflation reached 78.6% over one year, in June 2022, against 73.5% in May. A record since 1998. It is explained, in large part, by the collapse of the Turkish lira which has lost in one year, almost half of its value, against the dollar. It is transport, + 123%, and food products, + 93%, which have increased the most.
To compensate, the government announced last week a 25% increase in the minimum wage. Despite these record figures, the Turkish Central Bank still refuses to raise its key rate, which has been stable at 14% since December.
Inflation that is debating
Inflation has become a hot topic in Turkey, as its calculation is much debated. The opposition and several economists accuse the National Institute of Statistics of largely underestimating the rise in prices.
The president himself has fueled this mistrust, dismissing four directors of the Turkish Statistical Institute since 2019.
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