Compared to the previous month, prices increased by 2.37 percent. The data was slightly better than analysts polled by Reuters, who had expected annual inflation of 80.5 percent and month-on-month inflation of 2.9 percent.
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Prices in transport grew the most, by 119.11 percent. The prices of food and soft drinks increased by 94.65 percent.
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The sharp rise in consumer prices has already forced officials and economists to revise forecasts several times. Efforts to stabilize the domestic lira are failing, and Russia’s invasion of Ukraine is raising prices for everything from food to energy. The Turkish lira weakened by 44 percent against the dollar last year and has fallen by another 27 percent this year.
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The central bank refuses to raise interest rates
Inflation in Turkey began to rise sharply after the central bank cut interest rates late last year and has since refused to raise them. Rising prices and weak confidence in government policies triggered a sharp selloff in the Turkish lira. On the contrary, the leading central banks in the world are tightening their monetary policy as part of the fight against high inflation.
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Goldman Sachs expects consumer prices to peak around 90 percent in October or November. At the same time, inflation was 19 percent last July.
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For most Turks, the standard of living has fallen sharply due to high inflation. According to opinion polls, many have lost faith in official data. The gap between official figures and figures reported by other sources has widened significantly in recent months.
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In Istanbul, almost 100 percent
On Monday, a business group in Istanbul reported that inflation in Turkey’s most populous city was 99.1 percent in July. If the figure is correct, it would be a record high difference between Istanbul inflation and national figures.
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The ENAG group of academics says year-on-year inflation, according to their calculation, which is supposed to be virtually the same as the government’s, was 176 percent in July.
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Core inflation, which excludes volatile energy and food prices, rose to 61.7 percent in July from 57.3 percent in June.
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