ANKARA (Euro News) - Turkish inflation surged past 85 percent in October, its highest level since 1997, official data showed Thursday, as President Recep Tayyip Erdogan sticks to combat a cost-of-living crisis.
Central banks worldwide are raising borrowing costs in efforts to tame soaring consumer prices, but Turkey has bucked the global trend, with Erdogan calling higher interest rates his “biggest enemy”.
Last month, Turkey’s central bank cut its policy rate for a third consecutive time, bringing it down to 10.5 percent from 12 percent.
With an election looming next year, Erdogan argues that high rates are the cause of inflation, not the opposite, in defiance of orthodox economic theories.
Turkey’s inflation has steadily risen since reaching a low of 16.6 percent in May 2021.
It hit 85.51 percent in October, according to state statistics agency TUIK, up from 83.45 percent in September.
Independent economists, however, say the rate is more than twice as high.
At the same time, the Turkish lira has plunged against the dollar.
Despite soaring consumer prices, Erdogan praised the state of the country’s economy in an address to his ruling AKP lawmakers in parliament on Wednesday.
“Thank God, the wheels of the economy are turning,” he said.
“Our economic model, which we have summarized as growth through investment, employment, production, export and current account surplus, is bearing fruit.”
The head of the central bank, however, has said that success could not be declared.
“We cannot consider ourselves very successful in the fight against inflation,” central bank governor Sahap Kavcioglu said last month.