Inflation in Turkey rose slightly in August 2014, showing a 0.09 percent increase compared to previous the month according to a report released Wednesday by Turkish officials.
Turkstat, the country's official statistical agency, reported that annual inflation, which was 9.32 percent in last month, rose to 9.54 percent in August, indicating that annual inflation is above the Central Bank’s year-end forecast of 7.6 percent by a wide margin and almost double the 5 percent medium-term target.
On Tuesday, Turkey’s Deputy Prime Minister Ali Babacan said it was unlikely that Turkey’s year-end inflation rate would be in double digits. But he acknowledged the figure may end up above the government's target of 7 percent.
Babacan blamed high food prices due to the recent severe drought in the country.
In its last monetary policy meeting on Aug. 27, the Central Bank of Turkey announced that its tight monetary policy stance would be maintained until meaningful improvements in theinflation outlook, and left the interest rates on hold for another month.
Interest rates have been a matter of debate in Turkey for some time since the Central Bank of Turkey insisted on maintaining high interest rates until clear signs of an improvement in the inflation outlook materialized. Government officials have blamed the bank’s high interest rates policy for higher-than-expected inflation figures.