Inflation in Türkiye eased to its lowest in four years in November, official data showed on Wednesday, with both annual and monthly readings coming in below expectations, primarily due to food prices.
Annual consumer price inflation cooled to 31.07%, down from 32.87% in October, the Turkish Statistical Institute (TurkStat) said.
The figure, which had reached as high as 75% in May 2024, is now at its lowest level since November 2021, when it was 21.31%.
Month-over-month, inflation stood at 0.87%, falling below 1% for the first time in 30 months. In October, consumer prices rose 2.55% compared to the previous month.
The "scenario" with the November inflation has "increased our hopes," President Recep Tayyip Erdoğan told a parliamentary group meeting of the ruling Justice and Development Party (AK Party).
Treasury and Finance Minister Mehmet Şimşek said last month's figure marked the lowest monthly inflation in the last 2.5 years, adding that he expected the "moderate" trend to continue in December.
Surveys had forecast annual inflation of about 31.6% and a monthly rise of 1.25%.
The improvement in annual inflation compared to the peak in May last year has exceeded 44 percentage points, Şimşek wrote on the social media platform X.
The monthly figure was helped by lower food prices, especially vegetables and fruits, while housing, transportation and entertainment continued to exert upward pressure on the headline index.
On an annual basis, increases in housing, education and services were prominent, according to the Turkish Statistical Institute.
Erdoğan said they expect a rapid decline in rent inflation with the completion of rebuilding works in the southeastern region, which was struck by devastating earthquakes in early 2023, as well as social housing projects.
Şimşek said annual core goods inflation dropped below 19%, also noting that food inflation, which was significantly above the long-term average in August-October, normalized in November.
Inflation readings were above expectations in August and September but below forecasts in October and November, reinforcing views that the disinflation path is regaining momentum.
Unprocessed food prices drove the better-than-expected inflation, OYAK Securities said in a client note, adding it responded by lowering its year-end inflation forecast to 31.3%.
The Central Bank of the Republic of Türkiye (CBRT) slowed its easing cycle in October with a 100-basis-point rate cut that brought its policy rate to 39.5%.
Last week, it said preliminary data pointed to an improvement in November inflation and reiterated that it would adjust policy as needed to meet its targets, despite a slowdown in the expected disinflation trend earlier in the autumn.
The central bank's end-2025 inflation target stands at 24%, with its forecast range at 31%–33%. Markets are watching the bank's final Monetary Policy Committee (MPC) meeting of the year later this month for signals on the pace of future rate cuts.
Dutch financial giant ING said Wednesday's data reinforce the case for another measured rate cut. OYAK predicted a cut of 200 basis points.
"The central bank will likely remain cautious with a measured 100bp cut in the December MPC, in our view, though we should not rule out the possibility of a larger hike," the ING analysts said.
The data, meanwhile, also showed the domestic producer price index rose 0.84% month-over-month in November, bringing the annual reading to 27.23%.
Şimşek also cited some key factors he says would contribute to the disinflation process in 2026, including supportive global financial conditions and moderate commodity prices, tight monetary policy and strengthening financial stability.
He also noted supportive fiscal policy and the determination of managed prices (including tax and fee updates) in line with inflation targets within budgetary possibilities.
Şimşek stressed that rule-based pricing in education, the acceleration of improvement in expectations, and supply-side policies applied in many areas, particularly food, housing and energy, would also help the downward trend.
"We will resolutely continue to implement our (medium-term) program that centers on price stability," he noted.
