FX.co ★ Turkey’s annual inflation soars to 73.5%

Currently, the cost-of-living crisis in Turkey deepens.

The country’s annual inflation jumped to a 24-year high of 73.5% in May. According to the Turkish Statistical Institute’s data, prices in May soared to the highest level since 1998. At that time, Turkey faced severe economic and political crises. A record increase in consumer prices is caused by a sharp rise in energy prices as well as the lira’s significant depreciation. Consumer prices in May were up 3.5% from 70% in April. Compared to the same period in 2021, transportation and food costs surged by 107.62% and 91.63% respectively.

Turkey's economy has been under unprecedented inflationary pressure recently due to President Recep Tayyip Erdogan’s policy. He is a proponent of an alternative economic theory. According to it, a reduction in the key rate helps to combat rising inflation. The Turkish president has already fired several central bank governors.