Erdoğan adviser sees inflation slowing in first quarter

Cemil Ertem, senior economic adviser to President Recep Tayyip Erdoğan, expects inflation to slow by 200 basis points, or 2 percentage points, in the first quarter.

Consumer prices are now on a downward trend after CPI fell to 11.9 percent in December from 13 percent the previous month, the highest level in 13 years, Ertem said in an interview with Reuters, reported by the daily Hürriyet newspaper.

Inflation is being capped by government reforms related to the food sector and manufacturing costs, Ertem said.

While CPI slowed, according to data published by the government’s statistics agency on Wednesday, core inflation, which strips out volatile items such as food and energy prices, climbed to 12.3 percent, the highest since the data set was introduced in January 2004.

Economists including Inan Demir of Nomura and Timothy Ash of Bluebay Asset Management, have said they expect CPI to remain around 10 percent throughout this year.

Erdoğan is seeking to reduce inflation, calling on banks to cut lending rates, as he seeks to stimulate economic growth ahead of presidential and parliamentary elections due by next year.

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