Turkey’s CPI/PPI data for August featured 80% headline inflation rate, 66% core inflation rate and 144% PPI inflation rate. The outlook for the lira remains bleak, economists at Commerzbank report.
“What is so good about the data? Sure, more accurate statistics might have shown 90% inflation rate instead of 80% – and of course, we do not trivialise the need for honest statistics – but, why would anyone call the situation better if inflation were to moderate slightly (year-on-year) in coming quarters as lower commodity prices and base effect began to play a role?”
“If the lira needs defending, policymakers will probably only deploy ad hoc soft capital control measures – the benchmark rate cannot probably be raised.”
“How does an 80%, instead of 81%, inflation print vindicate policymakers?”