Turkey's annual inflation approaches two-digits
Business |
Prices of everyday goods have increased 9.66 percent in the last 12 months. "It is definitely something that we are watching but it is not really alarming," Babacan tells economic forum.
The average price level of everyday consumer goods rose 0.4 percent in Turkey in May according to Turkey's statistical authority on Tuesday. According to a report released by Turkstat, the Consumer Price Index rose 9.66 percent compared to the same month of last year, approaching the peak point for 2014 that Turkey's central bank previously estimated.
The highest monthly increase was in clothing and footwear, which rose 9.19 percent, while the largest decrease in food and non-alcoholic beverages, which fell 1.35 percent.
In his routine presentation to the Council of Ministers on June 2, Central Bank Governor Erdem Basci underlined that inflation is expected to peak in June and then start to abate from that point onward.
- Corporate debt 'not alarming': Turkish deputy PM
Turkeys Deputy Prime Minister responsible for economic affairs, Ali Babacan told an Istanbul economy forum on Tuesday that foreign-currency-denominated corporate debts were not a major concern since the current account deficit is decreasing.
"It is definitely something that we are watching but it is not really alarming," said Babacan, in a Q&A session after his speech at the Euromoney Eurasia Forum.
Turkey's private sector long-term foreign debt increased by US$2.5 billion in March to US$158.7 billion, the country's central bank said last month, while its short-term foreign debts increased by US$295 million to US$41.9 billion.
The lira tumbled to almost 2.4 to the dollar and 3.2345 to the euro in the first month of the year, which brought a major interest rate rise in the same month by the Turkish Central Bank; the move curbed the drop in Turkish lira.
Babacan stressed that a high amount of foreign direct investment inflow, which Turkey relies on to decrease its current account deficit, still continues into the country despite political and economic struggles in the last year.
The current account deficit is regarded as the biggest obstacle for the Turkish economy, which the government has prioritized fighting against.
Turkey attracted US$4.2 billion in FDI in the first quarter of 2014, an almost 50% rise compared to US$2.7 billion in the same period last year, according to the Turkish economy ministry.
The current account deficit decreased by US$5.09 billion between January and March 2014 to US$60 billion, Turkish central bank said.
According to a report released by the Turkish Statistical Institute (TurkStat), the foreign trade deficit has fallen by 30.3 percent compared to a year earlier in April.
Turkey's exports rose to US$13.45 billion in April 2014, a 7.9 percent increase compared to the same month last year, while imports decreased to US$20.67 billion, a 9.5 percent fall.
The head of Turkish central bank had said on Monday the recovery of Turkey's current account deficit is expected to continue.
Babacan said confidence in economy should be the priority for governing institutions, adding that if such confidence was boosted by an increase in interest rates, it is acceptable and would eventually contribute to growth.
On May 22, the bank cut its main interest rate to 9.5 percent from 10 percent while leaving other rates unchanged. After a sharp increase in interest rates in January, Prime Minister Recep Tayyip Erdogan and business leaders called on the bank to lower them, citing higher-than-expected growth figures and economic indicators.
The highest monthly increase was in clothing and footwear, which rose 9.19 percent, while the largest decrease in food and non-alcoholic beverages, which fell 1.35 percent.
In his routine presentation to the Council of Ministers on June 2, Central Bank Governor Erdem Basci underlined that inflation is expected to peak in June and then start to abate from that point onward.
- Corporate debt 'not alarming': Turkish deputy PM
Turkeys Deputy Prime Minister responsible for economic affairs, Ali Babacan told an Istanbul economy forum on Tuesday that foreign-currency-denominated corporate debts were not a major concern since the current account deficit is decreasing.
"It is definitely something that we are watching but it is not really alarming," said Babacan, in a Q&A session after his speech at the Euromoney Eurasia Forum.
Turkey's private sector long-term foreign debt increased by US$2.5 billion in March to US$158.7 billion, the country's central bank said last month, while its short-term foreign debts increased by US$295 million to US$41.9 billion.
The lira tumbled to almost 2.4 to the dollar and 3.2345 to the euro in the first month of the year, which brought a major interest rate rise in the same month by the Turkish Central Bank; the move curbed the drop in Turkish lira.
Babacan stressed that a high amount of foreign direct investment inflow, which Turkey relies on to decrease its current account deficit, still continues into the country despite political and economic struggles in the last year.
The current account deficit is regarded as the biggest obstacle for the Turkish economy, which the government has prioritized fighting against.
Turkey attracted US$4.2 billion in FDI in the first quarter of 2014, an almost 50% rise compared to US$2.7 billion in the same period last year, according to the Turkish economy ministry.
The current account deficit decreased by US$5.09 billion between January and March 2014 to US$60 billion, Turkish central bank said.
According to a report released by the Turkish Statistical Institute (TurkStat), the foreign trade deficit has fallen by 30.3 percent compared to a year earlier in April.
Turkey's exports rose to US$13.45 billion in April 2014, a 7.9 percent increase compared to the same month last year, while imports decreased to US$20.67 billion, a 9.5 percent fall.
The head of Turkish central bank had said on Monday the recovery of Turkey's current account deficit is expected to continue.
Babacan said confidence in economy should be the priority for governing institutions, adding that if such confidence was boosted by an increase in interest rates, it is acceptable and would eventually contribute to growth.
On May 22, the bank cut its main interest rate to 9.5 percent from 10 percent while leaving other rates unchanged. After a sharp increase in interest rates in January, Prime Minister Recep Tayyip Erdogan and business leaders called on the bank to lower them, citing higher-than-expected growth figures and economic indicators.
