After the Turkish Statistical Institute (TÜİK) announced that the Consumer Price Index (CPI) increased by 2.29 percent in March and the annual inflation fell to 50.51 percent, the Price Developments Report of the Central Bank of the Republic of Turkey (CBRT) was also published.
According to the report, annual inflation fell in all subgroups in March.
Energy group prices continued to follow a moderate course in line with the outlook in exchange rates and commodity prices. In addition to the stable course of the Turkish lira and the positive outlook in import prices, the monthly price increase in the core goods group slowed down due to the continuation of the seasonal discount in the clothing and footwear sector in March.
Food prices increased more than historically in this period, mainly led by red meat and processed meat products.
Another prominent item in the course of monthly consumer prices, along with food, was the service, mainly due to rent, catering services, training and package tours.
While the monthly increase in producer prices weakened in March with the support of the evident decline in energy prices, annual inflation in B and C indices continued to slow down under this outlook. Seasonally adjusted core indicators recorded the lowest monthly rate of increase since October 2021.
“Monthly increase in rent subgroup strengthened by 4.89 percent compared to the previous month”
Compared to the previous month, the contributions of energy, basic goods, food and non-alcoholic beverages, services and alcohol-tobacco-gold groups decreased by 1.80, 1.37, 0.60, 0.53 and 0.37 points, respectively.
When analyzed with seasonally adjusted data, monthly increases slowed down somewhat in B and C indexes compared to the previous month, while price increases weakened in services and core goods, especially in processed food, which is one of the B index groups.
Prices of services rose by 3.08 percent in March, while the group’s annual inflation decreased by 1.71 points to 59.93 percent.
In this period, annual inflation was recorded in the sub-groups of restaurants-hotels, communication and other services, with a more pronounced effect in transportation, and an increase in rents.
While the monthly increase in transportation services was moderate with 1.01 percent due to the decrease in intercity passenger transportation by road, annual inflation in the sub-group decreased by 13.15 points to 57.12 percent.
With the effect of food prices driven by red meat prices, the monthly rate of increase in restaurant-hotel prices remained high, while package tour and education services items, based on private school fees, stood out in the rise in the other services subgroup.
While the monthly increase in the rent subgroup strengthened by 4.89 percent compared to the previous month, the rise in the internet fee was the determining factor in the communication prices outlook.
“Annual inflation in the durable goods subgroup decreased by 4.72 points to 40.21 percent”
The monthly price increase in core goods slowed down in line with the outlook in commodity prices and the Turkish lira, and annual inflation in this group fell by 4.48 points to 36.58 percent.
While the prices of durable goods (excluding gold) rose by 1.67 percent on a monthly basis, the furniture item stood out in this development with a price increase of 5.22 percent. More moderate price movements were observed in automobile and white goods items.
As a result of these developments, annual inflation in the durable goods subgroup decreased by 4.72 points to 40.21 percent.
Prices in other core goods rose 2.52 percent in this period. Following the regulation in the legal profitability scales in the middle of the month, drug prices increased by 5.38 percent and household cleaning materials increased by 4.47 percent.
In the clothing and footwear sub-group, prices decreased by 2.02 percent due to the continuation of seasonal discounts in March, while annual inflation decreased by 4.45 points to 16.26 percent.
“Monthly energy prices maintained their moderate course with an increase of 0.38 percent”
Energy prices maintained their moderate course with an increase of 0.38 percent in March. Thus, annual inflation in this group decreased by 14.35 points to 35.66 percent. Despite the increase in mains water prices, the effect of the decline in fuel prices following the retreat in international crude oil prices was felt in this development.
Prices of food and non-alcoholic beverages increased by 3.84 percent in March, while annual inflation decreased by 1.44 points to 67.89 percent.
Annual inflation decreased by 0.19 points to 65.94 percent in unprocessed food and to 71.68 percent in processed food, with a decrease of 2.19 points.
Seasonally adjusted data pointed to a decrease in fresh fruit and vegetable prices, especially in the vegetable group.
While the increase in food prices in March was mainly due to red meat, white meat and related processed meat products, the increase in egg prices also drew attention. The increases in the prices of bread-cereal products continued in this period as well.
While domestic producer prices increased slightly by 0.44 percent in March, annual inflation decreased by 14.16 points to 62.45 percent.
While annual inflation decreased in all sub-groups according to main industry groups, energy prices on a monthly basis showed a significant decrease due to the developments in industrial natural gas and electricity prices.
When monthly price developments are analyzed by sectors, prices of electricity-gas manufacturing and refined petroleum products decreased, while food, fabricated metal, wood-cork products, printing-registration services and furniture manufacturing sectors came to the fore with price increases.
