The Central Bank of the Republic of Turkey revised up its year-end inflation forecast by 10 basis points in its third quarter inflation report released on Thursday.Speaking at press conference held to announce the report, governor Erdem Başçı said that a decline in food prices was contributing positively to the inflation outlook. "Inflation is expected to be, with 70 percent probability, between 6.0 percent and 7.8 percent (with a mid-point of 6.9 percent) at end-2015 and between 3.7 percent and 7.3 percent (with a mid-point of 5.5 percent) at end-2016. Inflation is projected to stabilize around 5 percent in the medium term," the report said.Başçı linked a possible easing in monetary policies to a significant drop in inflation."There is not yet a significant improvement in the inflation outlook. We forecast inflation to reach our targets in the medium term" Başçı said.Başçı noted that the Turkish lira's decline in value against the dollar has delayed improvement in inflation.Domestic consumption in Turkey is rising moderately, and not on the basis of consumer credit, Başçı pointed out. He said that this is an indication of employment growth, and that economic activity was speeding up compared with the previous quarter.Basçı said that Turkey had nothing to fear from a U.S. interest rate increase, as the bank has controls in place."Nobody should expect an early loosening or excessive tightening from us. We will go to August meeting with plans for moderate tightening," he added.