Single-digit inflation targeted for 2027: Şimşek
ANKARA
Treasury and Finance Minister Mehmet Şimşek stated that Türkiye's disinflation process is advancing steadily, aiming for single-digit inflation in 2027, while expecting the year-end rate to stay within the central bank's 19-29 percent forecast and drop below 20 percent next year.
In an interview with Reuters, Şimşek affirmed, "We maintain our year-end inflation forecast; the necessary conditions for disinflation are largely in place."
"Disinflation is progressing along our projected path. What matters to us is that this improvement is lasting and stable," he added.
July's consumer price inflation slowed to 33.5 percent , down from a peak of 75 percent in May 2024.
The central bank recently cut its policy rate by 300 basis points to 43 percent , resuming easing after earlier disruptions.
Şimşek emphasized policy coordination: "Monetary policy provides strong support to disinflation through the channels of demand, the exchange rate, and expectations, while increased coordination with fiscal policy reinforces this effort."
While noting limited upside risks from oil prices, tariffs, and unprocessed food, he said the government is ready to "prevent any obstacle to disinflation by taking the necessary steps to counter potential shocks."
Growth this year may be "slightly below" the medium-term program's 4 percent target, described as a "temporary slowdown" rather than a downturn, after 2 percent in first quarter.
The current account deficit should fall below targets, with spending discipline maintained despite lower budget revenues from slower growth and inflation.
External financing from institutions for development projects totaled $17.4 billion in 2023-2024, with $7 billion secured so far this year.
"We have established our medium-term cooperation framework with the World Bank, the Islamic Development Bank, and the Asian Infrastructure Investment Bank (AIIB). With the contributions of other institutions, we aim to secure over $40 billion in external financing in the next three years," Şimşek said.
