Year-end figure aligns with central bank forecast, though independent economists dispute official data
Turkey’s annual inflation rate slowed further in December, falling to 30.9 per cent, official data released on Monday showed, extending a steady decline for the fourth straight month and marking a significant drop from the 44.4 per cent recorded in the same period last year.
According to the Turkish Statistical Institute (TUIK), the 12-month annual average inflation rate for 2025 stood at 34.9 per cent, a sharp improvement from 58.5 per cent in 2024, reflecting the impact of tighter monetary policies implemented over the past year.
The December figure was broadly in line with projections by Turkey’s central bank, which had earlier forecast year-end inflation in the range of 31 to 33 per cent.
Inflation had peaked at 75 per cent in May 2024 before entering a downward trend, with the latest reading representing its lowest level since November 2021.
Despite the recent moderation, Turkey has grappled with double-digit inflation since 2019, a situation that has significantly increased living costs for millions of citizens. The prolonged inflationary pressure followed years of unconventional economic policies under President Recep Tayyip Erdoğan, including repeated interest rate cuts aimed at stimulating economic growth.
TUIK data showed that consumer prices continued to rise sharply across key sectors over the past year. Education costs recorded the steepest increase at 66 per cent, followed by housing at 49.5 per cent, healthcare at 30.1 per cent, and food prices at 28.3 per cent.
However, the official inflation figures were challenged by the Inflation Research Group (ENAG), an independent body of economists, which estimated Turkey’s year-on-year inflation at 56.14 per cent in December. ENAG also reported a 2.11 per cent month-on-month increase in consumer prices from November.
Meanwhile, Turkey’s central bank last month reduced its benchmark interest rate to 38 per cent, down from 39.5 per cent, citing the sustained slowdown in inflation.
Nevertheless, the bank cautioned that inflation expectations and pricing behaviour remain areas of concern, warning that they continue to pose risks to the country’s ongoing disinflation efforts.
