Turkish inflation decelerated at its steepest pace in more than a quarter of a century, a slowdown that may be at risk from a public spending splurge planned ahead of elections.
Consumer prices rose by an annual 64.3 per cent in December, lower than the 84.4 per cent increase in the previous month, according to data released by state statistics agency TurkStat on Tuesday.
The median forecast of economists surveyed by Bloomberg was 66.7 per cent.
Much of the slowdown reflects a base effect from fast price increases in the last month of 2021, when the lira lost nearly a fifth of its value within days, making imports more expensive.
Subdued credit growth and a relatively stable currency since then have led policymakers to expect inflation at 22.3 per cent by the end of this year.
Increases in the cost of food, energy and factory-gate prices all slowed to below 100 per cent.
That is signalling “a visible downward trend” that allowed the government to meet targets in its medium-term programme, said Treasury and Finance Minister Nureddin Nebati.
But the improvement is set to lose momentum as the government prepares to ramp up spending before presidential elections scheduled for June.
On a monthly basis, inflation rose 1.18 per cent in December. Core prices, which exclude volatile items such as food and energy, increased 51.93 per cent.
With that stickiness in prices, many economists expect inflation to end the year at 44 per cent, more than three times the average of 15 peers tracked by Bloomberg across Europe, the Middle East and Africa.
“Turkey’s rampant inflation has taken a large step down due to high base effects that will keep the rate receding through 2023,” Selva Bahar Baziki of Bloomberg Economics said.
“Even with expectations for a sharp fall in the year-on-year rate, December inflation still surprised to the downside at 64.3 per cent.
“We expect the year-end inflation rate to remain above 30 per cent — six times the central bank’s target rate of 5 per cent.
“Still, we do not see the central bank combating high price gains with policy rate hikes until after this year’s elections — once the vote is out of the way, the build-up of risk in the economy is [expected] to call for a policy reversal.”
Turkish President Recep Tayyip Erdogan last month promised early retirement for millions of workers in a pre-election pledge that is expected to cost the Turkish Treasury about $13 billion a year.
The government also announced a 55 per cent increase in the official minimum wage and is preparing to inject $3.3 billion into state banks to speed up cheap lending to help businesses to cope with rising costs.
The Turkish leader sees lower borrowing costs as key to his ambitions to boost investment and job creation before the elections.
Under his explicit guidance, Governor Sahap Kavcioglu lowered the central bank’s key interest rate by 500 basis points to 9 per cent in November.
Turkey's cost of living crisis — in pictures
While delivering four consecutive rate cuts, Mr Kavcioglu blamed rampant inflation on high energy prices and a weak currency that drove up import costs.
The central bank chief will present his next quarterly report on the inflation outlook on January 26 and will write an open letter to the government explaining why he missed the official target of 5 per cent.
“We still need to take into account the planned surge in public spending before the elections, which may feed periodical price increases,” Istanbul-based Tera Yatirim’s chief economist Enver Erkan said.
“Overall demand and a desire by companies to pass on rising costs will [affect] future price hikes.”
SPECS
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Short-term let permits explained
Homeowners and tenants are allowed to list their properties for rental by registering through the Dubai Tourism website to obtain a permit.
Tenants also require a letter of no objection from their landlord before being allowed to list the property.
There is a cost of Dh1,590 before starting the process, with an additional licence fee of Dh300 per bedroom being rented in your home for the duration of the rental, which ranges from three months to a year.
Anyone hoping to list a property for rental must also provide a copy of their title deeds and Ejari, as well as their Emirates ID.
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House-hunting
Top 10 locations for inquiries from US house hunters, according to Rightmove
- Edinburgh, Scotland
- Westminster, London
- Camden, London
- Glasgow, Scotland
- Islington, London
- Kensington and Chelsea, London
- Highlands, Scotland
- Argyll and Bute, Scotland
- Fife, Scotland
- Tower Hamlets, London
ESSENTIALS
The flights
Emirates flies from Dubai to Phnom Penh via Yangon from Dh2,700 return including taxes. Cambodia Bayon Airlines and Cambodia Angkor Air offer return flights from Phnom Penh to Siem Reap from Dh250 return including taxes. The flight takes about 45 minutes.
The hotels
Rooms at the Raffles Le Royal in Phnom Penh cost from $225 (Dh826) per night including taxes. Rooms at the Grand Hotel d'Angkor cost from $261 (Dh960) per night including taxes.
The tours
A cyclo architecture tour of Phnom Penh costs from $20 (Dh75) per person for about three hours, with Khmer Architecture Tours. Tailor-made tours of all of Cambodia, or sites like Angkor alone, can be arranged by About Asia Travel. Emirates Holidays also offers packages.
The%20Secret%20Kingdom%20
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Key recommendations
- Fewer criminals put behind bars and more to serve sentences in the community, with short sentences scrapped and many inmates released earlier.
- Greater use of curfews and exclusion zones to deliver tougher supervision than ever on criminals.
- Explore wider powers for judges to punish offenders by blocking them from attending football matches, banning them from driving or travelling abroad through an expansion of ‘ancillary orders’.
- More Intensive Supervision Courts to tackle the root causes of crime such as alcohol and drug abuse – forcing repeat offenders to take part in tough treatment programmes or face prison.
Volvo ES90 Specs
Engine: Electric single motor (96kW), twin motor (106kW) and twin motor performance (106kW)
Power: 333hp, 449hp, 680hp
Torque: 480Nm, 670Nm, 870Nm
On sale: Later in 2025 or early 2026, depending on region
Price: Exact regional pricing TBA
Global state-owned investor ranking by size
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United States
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2.
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China
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3.
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UAE
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4.
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Japan
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5
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Norway
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6.
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Canada
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Singapore
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Australia
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Saudi Arabia
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South Korea
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SPECS
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GULF MEN'S LEAGUE
Pool A Dubai Hurricanes, Bahrain, Dubai Exiles, Dubai Tigers 2
Pool B Abu Dhabi Harlequins, Jebel Ali Dragons, Dubai Knights Eagles, Dubai Tigers
Opening fixtures
Thursday, December 5
6.40pm, Pitch 8, Abu Dhabi Harlequins v Dubai Knights Eagles
7pm, Pitch 2, Jebel Ali Dragons v Dubai Tigers
7pm, Pitch 4, Dubai Hurricanes v Dubai Exiles
7pm, Pitch 5, Bahrain v Dubai Eagles 2
Recent winners
2018 Dubai Hurricanes
2017 Dubai Exiles
2016 Abu Dhabi Harlequins
2015 Abu Dhabi Harlequins
2014 Abu Dhabi Harlequins
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
Biography
Favourite book: Zen and the Art of Motorcycle Maintenance
Holiday choice: Anything Disney-related
Proudest achievement: Receiving a presidential award for foreign services.
Family: Wife and three children.
Like motto: You always get what you ask for, the universe listens.
Dark Souls: Remastered
Developer: From Software (remaster by QLOC)
Publisher: Namco Bandai
Price: Dh199
More from Neighbourhood Watch:
The Bio
Amal likes watching Japanese animation movies and Manga - her favourite is The Ancient Magus Bride
She is the eldest of 11 children, and has four brothers and six sisters.
Her dream is to meet with all of her friends online from around the world who supported her work throughout the years
Her favourite meal is pizza and stuffed vine leaves
She ams to improve her English and learn Japanese, which many animated programmes originate in
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Director: Jon Favreau
Starring: Donald Glover, Seth Rogen, John Oliver
Rating: 2 out of 5 stars
Museum of the Future in numbers
- 78 metres is the height of the museum
- 30,000 square metres is its total area
- 17,000 square metres is the length of the stainless steel facade
- 14 kilometres is the length of LED lights used on the facade
- 1,024 individual pieces make up the exterior
- 7 floors in all, with one for administrative offices
- 2,400 diagonally intersecting steel members frame the torus shape
- 100 species of trees and plants dot the gardens
- Dh145 is the price of a ticket
