Turkey | August inflation surprised on the downside

Summary

Consumer prices increased by 0.86% mom in August, far below the consensus and ours (1.3% Bloomberg vs. 1.4% BBVA Research). Annual inflation decreased from 16.65% in July to 15%, the lowest level in the last 15 months. We maintain our year-end forecast of 15% with downside risks.

Key points

• Key points:
• August inflation in monthly terms was better than the market expectations (0.86% actual vs 1.3% Bloomberg)
• Annual inflation could decrease to one digit-level in October with high probability.
• Current inflation momentum reinforced the position of the CBRT to continue the easing.

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