Announced Inflation Figures

The Turkish Statistical Institute (TUIK) has announced consumer inflation data for the month of May.

Thus, in May 2023, consumer prices were 0.04 percent compared to the previous month, 15.26 percent compared to December of the previous year, 39.59 percent compared to the same month of the previous year and 63 .72 percent based on twelve-month averages. occurred.

TURKSTAT announced last week that a ‘zero price’ method for natural gas will be applied in inflation calculations due to the free supply of natural gas to households for one month, so a ‘strong downward effect’ is expected ‘ in the general index.

Thus, with the effect of the zero price method, monthly inflation was close to 0, while annual inflation fell below 40 percent.

TurkStat announced monthly inflation of 2.39 percent and annual inflation of 43.68 percent in April.

The inflation expectation for May was 0.07 percent monthly, 39.6 percent annually in the AA survey and -0.2 percent monthly and 39.2 percent annually in the Reuters survey. However, contrary to economists’ expectations, inflation did not turn negative and the monthly series of increases in the consumer price index continued in month 53.

Inflation in Istanbul, announced by the Istanbul Chamber of Commerce (ITO), was 1.66 percent monthly and 56.05 percent annually in April.

The fact that TÜİK reduces inflation on natural gas in the May computation will also affect the salaries of workers and officials to be made in July. The sharp six-month drop in inflation is expected to make the inflation gap in civil servants’ salaries smaller than expected.

FOOD INFLATION 52.52 PERCENT

According to TUIK data, annual food inflation was 52.52 percent. According to the data, the main group that showed the smallest increase compared to the same month of the previous year was clothing and footwear with 19.49 percent.

For its part, the main group with the greatest increase compared to the same month of the previous year was restaurants and hotels with 68.98 percent.

On the other hand, in May 2023, the main group with the greatest increase compared to the previous month was clothing and footwear with 9.85 percent. Monthly food inflation was 0.28 percent

EFFECT OF NATURAL GAS ON HOUSING EXPENSES

Regarding the main spending groups, the main group that presented the smallest increase in May 2023 compared to the previous month was housing with -13.79 percent. The application of the ‘zero price’ method for natural gas prices was effective in reducing housing expenses.

The variation of the CPI without unprocessed food, energy, alcoholic beverages, tobacco and gold is 3.60 percent in May 2023 compared to the previous month, 19.51 percent compared to December of the previous year, 47 percent compared to the same month of the previous year year It was carried out as 60.94 percent according to the averages of .70 and twelve months.

HIGH CHAMPION POTATOES

According to TUIK data, the champion price in May was potatoes. Potato prices increased 37.1 percent on a monthly basis. Children’s clothing prices increased 18.87 percent and men’s clothing prices increased 15.51 percent.

Women’s clothing prices rose 10.5 percent in May. Hotel prices increased 10.5 percent and fresh fruit prices increased 10 percent. The product with the greatest price decline in May was the price of vegetables with 17.62 percent.

NATURAL GAS EFFECT

TurkStat had warned that when calculating the inflation data, it would take into account that natural gas was distributed for free in May, and that this practice would have a “strong effect” on downward inflation.

Before the elections, President Recep Tayyip Erdoğan announced that natural gas will be distributed free of charge in May, and 25 cubic meters of natural gas consumed by each household will not be charged until May next year.

In the statement made by TÜİK, it was indicated that “the ‘zero price’ method will be applied for natural gas in the scope of CPI calculations for May 2023.” The statement also indicated that not charging for 25 cubic meters of natural gas would be reflected in the calculations.