07.11.2025 12:08
The Central Bank President Fatih Karahan made important statements at the press conference where the fourth and final inflation report of the year was announced. Karahan stated, "Rent inflation will decline. We will support the disinflation process."
The President of the Central Bank of the Republic of Turkey (CBRT), Fatih Karahan, announced the last inflation report of the year. Karahan stated that rental inflation would decrease and that they would support the disinflation process, delivering striking messages.
Key points from Central Bank President Karahan's statements are as follows: "Although the disinflation process that has been ongoing since June 2024 has slowed down recently, we will ensure that inflation continues to align with intermediate targets through the steps we will take. We will continue to use all monetary policy tools decisively. We will continue to use all monetary policy tools decisively."
Global uncertainty continues to remain above historical averages. While there are differences between countries, the global disinflation process has lost some momentum.
"DEMAND COMPOSITION IS CONSISTENT WITH THE DISINFLATION PROCESS"
The balanced trend in the demand composition continues, consistent with the disinflation process. The capacity utilization rate confirms the slowdown in activity. The labor market is less tight than implied by the headline unemployment rate. The Composite Labor Market Index, based on a comprehensive data set regarding the labor market, shows an increase in the third quarter, yet continues its weak trend.
When adjusted for card usage trends, card expenditures are lower. Card expenditures remained relatively flat in the third quarter. When demand-related data is evaluated as a whole, it indicates that demand conditions were at disinflationary levels in the third quarter. The current account deficit was in line with the domestic demand outlook in the second quarter. We anticipate that the current account deficit as a percentage of national income will remain below long-term averages in 2025.
"WE EXPECT THE DISINFLATIONARY OUTLOOK TO CONTINUE"
We expect the disinflationary outlook to continue for the remainder of the year. We have gone through a period where the disinflation process slowed down in the last two months. In the last two months, inflation has occurred above the forecast range. The effects of food-related prices have come to the forefront. The trend of slowing inflation in non-food consumer prices has continued. The average of the 6 indicators we have been tracking in the main trend over the last 3 months points to levels around 28%. Although the main trend indicators are below 32.9%, they indicate that the disinflation process has slowed down.
"RESILIENT TREND IN EDUCATION AND RENT CONTINUES"
We see that the inertia in service inflation, influenced by high items such as education and rent, which have a tendency for time-dependent price determination and indexing to past inflation, continues to be resilient. Although education services inflation has decreased compared to the previous year, it remains high. Rental inflation has been more resilient than expected, although it has slowed down in recent months.
Compared to the previous reporting period, we see that the improvement in expectations for 12 months ahead has slowed down. In the upcoming period, we anticipate that the improvement in inflation expectations will be supported by our decisive stance in monetary policy and the resulting declining inflation figures.
"WE MAINTAIN A TIGHT MONETARY STANCE"
We maintain our tight monetary policy stance. The tight monetary stance is supported by macroprudential measures and liquidity management."