Household inflation expectations deteriorate: Survey

ANKARA

In October, the 12-month-ahead annual inflation expectations compared to the previous month increased by 1.40 points to 54.39 percent for households and by 1.01 points to 23.26 percent for market participants, the Central Bank said on Oct. 30.

The proportion of households expecting a fall in inflation in the next 12 months, compared to the previous month, decreased by 0.85 points to 26.50 percent.

For the real sector, 12-month ahead inflation expectations decreased by 0.50 points to 36.30 percent, showed the bank’s regular Sectoral Inflation Expectations survey.

Türkiye's annual inflation rate in September ticked up to 33.29 percent from 32.95 percent in August, above market expectations.

In its Monetary Policy Committee meetings held on Oct. 23, following the release of the disappointing inflation numbers, the Central Bank lowered its policy rate by 100 basis points, matching market forecasts.

The benchmark one-week repo rate was lowered from 40.5 percent to 39.5 percent.

In an accompanying statement, the bank said that while recent data suggest that demand conditions are at disinflationary levels, they also point to a slowdown in the disinflation process.

“The risks posed by recent price developments, particularly in food, to the disinflation process through inflation expectations and pricing behavior have become more pronounced,” it added.