Inflation was announced as 69.97 percent on an annual basis in April - Upsmag - Magazine News

Inflation was announced as 69.97 percent on an annual basis in April

May 5, 2022, 10:04 +03

Update 52 minutes ago

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Turkish Statistical Institute (TUIK) announced the inflation rates for April. According to Turkstat, the Consumer Price Index (CPI) increased by 7.25 percent last month, while inflation rose by 69.97 percent on an annual basis.

Inflation figures for March, announced last month, reached 61.14 percent, the highest level of the last 20 years. In Turkey, the highest inflation was in March 2002 with 65 percent.

The lowest annual increase was in the communication main group with 18.71 percent.

Food inflation 89.1 percent

The other main groups in which the increase was lower compared to the same month of the previous year were clothing and footwear with 26.23 percent, education with 27.73 percent and health with 35.95 percent, respectively.

On the other hand, the main groups with the highest increase compared to the same month of the previous year were transportation with 105.86 percent, food and non-alcoholic beverages with 89.10 percent, and household goods with 77.64 percent, respectively.

In April, the producer price index (PPI) was 7.67 percent on a monthly basis and 121.82 percent on an annual basis. Thus, producer prices peaked after 1995.

The annual change in producer prices in four sectors of the industry increased by 125.88 percent in mining and quarrying, 112.08 percent in manufacturing, 247.50 percent in electricity and gas production and distribution, and 63.17 percent in water supply.

ENAG: Annual inflation is 156.86 percent

On the other hand, the Inflation Research Group (ENAG), composed of economists and academics, calculated annual inflation as 156.86 percent. According to ENAG, monthly inflation was 8.68 percent. These rates were calculated with hourly and daily price changes.

What reactions were given?

Many financial experts and academics shared their concerns about the increase in inflation on their social media accounts.

Prof. from Istanbul University Faculty of Business Administration. Dr. Murat Kıyılar shared on Twitter, “We have watched this movie before. Why aren’t lessons learned from history?” he asked.

Kerim Rota, President of the Future Party’s Economic Policy, underlined that Turkey is the sixth country with the highest inflation in the world, with inflation in April, and said, “We are the leader in negative interest rates that provide wealth transfer to those who can use credit.”

On the other hand, economist Arda Tunca, author of the Politikyol website, said in his Twitter post that TUIK gave a message with the aforementioned data, “Economics has rules. If not implemented, society collapses economically. When we say ‘inflation will go to 70%’, we would like to listen to the current comments of those who say ‘mandacı’,” he wrote.

Some experts made some warnings, drawing attention to the increases in PPI.

Finance expert Serdar Pazi said, “The PPI continues to rise, its reflections on the CPI will also continue.”

Another economist, Mustafa Sönmez, argued that PPI would put pressure on inflation in May.

Fed made the highest rate hike in recent years to fight inflation

Announcing its interest rate decision on Wednesday, the US Federal Reserve (Fed) increased interest rates by 50 basis points, the highest rate hike in recent years.

The Fed, which made such a high rate hike for the first time since 2000, announced that it would tighten its monetary policy to combat rising inflation.

The market had expected the Fed Open Market Committee (FOMC) to raise interest rates by 50 basis points.

Thus, the policy interest rate was increased from 0.25-0.50 percent to 0.75-1.00 percent.

In March, when the previous meeting was held, the Fed increased interest rates for the first time since 2018 and increased the policy rate by 25 basis points.

The Organization for Economic Cooperation and Development (OECD) also shared the statistics for March in its report published on Wednesday. Accordingly, in March 2022, consumer prices in OECD countries increased by 8.8 percent compared to the previous year. In February 2022, the increase was 7.8 percent. This was the highest increase seen in OECD countries since October 1988.

While inflation rose to double-digit rates in about one-fifth of OECD countries, the highest inflation was seen in Turkey, according to the same report.

Annual inflation in the G20 region, of which Turkey is also a member, reached 7.9 percent in March 2022. It was 6.8 percent the previous month.

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