Emerging Europe Economics

Emerging Europe Economics Update

4 July, 2018

Is Turkish inflation spiralling out of control?

Yesterday’s stronger-than-expected consumer price figures from Turkey provides further evidence that falls in the lira are feeding through into higher inflation more quickly and to a greater extent than had previously been the case. More than anything, this seems to reflect unanchored inflation expectations – a situation that will only get worse if President Erdogan pursues looser monetary and fiscal policy.

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