Turkey aims to reduce inflation to 4.7% by 2028: Erdogan

Ankara, Oct 18 (IANS): Turkish President Recep Tayyip Erdogan said his government seeks to reduce inflation to 4.7 per cent by the end of 2028.

“We aim to permanently reduce inflation to single digits and reduce it to 4.7 per cent by the end of 2028,” Erdogan said in a post on X.

Turkey’s annual inflation rate climbed to 61.53 percent in September as the central bank aggressively raised interest rates from 8.5 per cent to 30 per cent since June, reports Xinhua news agency.

“We aim for a stable and balanced growth of 5 per cent on average,” Erdogan said, adding that “we aim to reach a national income of $1.589 trillion and a per capita income of $17,554 in 2028”.

Following eight months of decline to 38.2 per cent in June, the lowest level in a year and a half, Turkey’s annual inflation increased again in July, reaching 47.8 per cent and 59 per cent in August, due to the lira’s continued weakening in the import-reliant country.

Turkey has been experiencing uninterrupted double-digit inflation since the end of 2019, making the cost of living difficult to bear for households across the country despite wage and pension hikes.

After his re-election in May, President Erdogan had promised to improve the economy and embraced a pivot away from his ultra-loose monetary policies of the past.

A new economic team he put in place hiked interest rates aggressively from 8.5 per cent to 30 per cent since June to tame persistent inflation.

Yet, driven by the government’s tax increase, hefty wage hikes, and rising exchange rates, inflation picked up again in the past three months.

The Turkish government raised its annual inflation forecast to 65 per cent for this year and only expected it to enter a downward trend as of the first half of 2024.