Turkey's inflation of the year dropped to 55.18% in February

March 6, 2023: On Friday, Turkish annual inflation decreased slightly to 55.18% in February, official data revealed, just below forecast, following massive earthquakes that reached its southeast region and killed over 45,000 people just under a month ago.

Every month, consumer prices increased by 3.15%, the Turkish Statistical Institute said, lower than a poll forecast of 3.4%. Annually, consumer cost inflation <TRCPIY=ECI> was forecast to be 55.5%.

The most significant monthly price rise was in the food and non-alcoholic drinks sector, up 7.36%, while prices of education, restaurants, and hotel items rose 5.69% and 4.07%, respectively.

The statistics institute stated that prices from the field were not collected from the earthquake-reached provinces of Gaziantep, Malatya and Hatay.

The domestic producer price index increased 1.56% month-on-month in February for an annual increase of 76.61%

The lira traded at 18.8920 following the data, unchanged from its close on Thursday. The currency has been flat since the summer due mainly to state management.

A currency crisis has stoked inflation by ending 2021 and reached a 24-year peak of 85.51%. The central bank slashed its policy rate despite zooming inflation to preserve growth momentum and added a 50 basis point cut following the earthquake.

Economists and administration officials anticipate the earthquake, which damaged hundreds of buildings, to cost over 50 billion lire and shave one to two percentage points off the economic growth this year.