Turkiye's annual inflation is expected to peak at 74.8% in May to hit its highest level since November 2022, with the annual rate seen dropping to 42.6% by the end of 2024, a Reuters poll showed on Thursday.
The median estimate of 13 economists for annual inflation was 74.8%, with forecasts ranging from 74.3% to 75.3%. Monthly, forecasts for price rises ranged between 2.7% and 3.3%.
In January and February, inflation climbed 6.7% and 4.53%respectively, largely due to a big minimum wage hike and an array of new-year price updates. In March and April, the rise in inflation slowed to around 3.2%. Annual inflation stood at 69.8% last month.
The Turkish central bank, which had already hiked rates by 3,650 basis points since June before pausing its tightening, decided to hike the benchmark rate by another 500 basis points in March due to deterioration in the inflation outlook.
In April and May, the central bank decided to keep the policy rate unchanged, considering the lagged effects of the monetary tightening, and vowed to tighten further in the case of a significant deterioration in inflation.
The central bank sees inflation peaking around 75% in May and starting its decline in the second half of the year.
Earlier this month, Turkish central bank nudged up its year-end inflation forecast to 38% and said they would "do whatever it takes" to avoid any longer-term deterioration of inflation outlook.
The Reuters poll showed annual inflation falling to 42.6% by year-end, higher than the central bank's forecast, based on the median estimate. Forecasts ranged between 40% and 48%.
Separately, Turkiye's foreign trade deficit rose 12.9% year-on-year to $9.86bn in April, official data showed on Thursday.
In April, exports rose 0.1% year-on-year to $19.25bn and imports increased 4.0% to $29.12bn, data from the Turkish Statistical Institute showed.
According to the official data, China was the biggest source of imports, amounting to $3.75bn in April, while imports from Russia reached $3.33bn.
In April, Turkiye's top export destination country became Germany, with exports amounting to $1.48bn. Turkiye's exports to the US reached $1.19bn and exports to the UK totalled $1.17bn.