Turkey’s Highest Inflation Rate in Nearly 20 Years: Rises to Record High of 36 Percent

3rd January 2022
Business, News, Turkey

Turkey has recorded a record inflation rate of 36.08 percent in the past month. That is 15 percent higher than in November and much higher than analysts had expected. As a result, the Turks see their money-losing value every day, while their groceries are becoming significantly more expensive.

In the past month, Turks paid 36 percent more for goods and services than in December 2020. It is the most significant increase in more than nineteen years. In September 2002, prices were on average 37 percent higher than one year previously.

Inflation has been high in Turkey for a long time. It is being propelled by the weak exchange rate of the national currency, the lira. As a result, it has plummeted in value against the dollar. In one year, the lira lost 45 percent against the dollar.

The sky-high inflation means that they have to pay much more for their groceries for the Turks. They see their money-losing value every day, while even basic products become significantly more expensive. For example, according to official figures, flour and chicken have become 86 percent more expensive. The sunflower oil prices have risen by 76 percent, those of bread 54 percent.

Despite inflation, which has been high for some time, the Turkish central bank has repeatedly cut interest rates under pressure from President Recep Tayyip Erdogan. Normally, central banks try to fight inflation with higher interest rates.

The soaring inflation is not only causing much discontent and tension. Still, it has also become the starting point of a political struggle one and a half years before the upcoming presidential elections. The opposition accuses the Turkish statistical office of systematically underestimating inflation.

“Opponents of Erdogan really see this as confirmation of economic mismanagement, as a result of strong authoritarian leadership, which has created a climate where no one dares to contradict the president anymore,” said correspondent Mitra Nazar in Turkey. “There is a lot of anger. But there is also a core of loyal Erdogan supporters, who trust that things will get better and that Erdogan has a plan.”