Turkey's inflation falls to 6.16%

Turkey's inflation rate in December 2012 stood at 6.16 percent, registering a record low in 15 months, data from the Turkish Statistics Institute (TurkStat) showed Thursday. As for the monthly data, the consumer price index (CPI) moved up 0.38 percent over that in November, a rate notably slower than economists expected. The slowed inflation in December was aided by a drop in food prices, which increased by just 1.5 percent year on year, the statistical authority noted. The fall in food prices also led to November's lower inflation rate, which was a significant drop from 7.8 percent in October and 9.19 percent in September. TurkStat also stated that Turkey's producer price index (PPI) increased at a year-on-year rate of 2.45 percent in December, slower than 3.6 percent in November. However, according to 12-month average of the whole year, annual inflation rate of 2012 is 8.89 percent, which is far above the government's initial goal of 5.2 percent. Analysts expect inflation to go up again in 2013 because of price hikes and rising taxes as well as new central bank's cuts in borrowing rates. "Inflation is down, but in 2013 it's going to get harder. Because of price hikes and rising taxes, inflation is going to be pushed up appreciably," Marbas Securities Research Manager Uzeyir Dogan said Thursday.