Iran war exerts cost-push pressure on inflation, governor of Turkish Central Bank says
The governor of the Central Bank of the Republic of Türkiye says the ongoing war in the Middle East has driven a sharp rise in energy prices, adding cost-push pressure on inflation. The bank is taking measures to limit the war's impact on the inflation outlook and ensure the continuation of the disinflation process.
The Central Bank of the Republic of Türkiye is monitoring the impact of the Middle East war on inflation. Energy prices have risen sharply, exerting cost-push pressure on inflation. The bank's analyses indicate that a 10% increase in oil prices adds 1.1 percentage points to consumer inflation over a year. The implementation of the sliding-scale system mitigates the spillover of this impact to consumer prices. The war is expected to have both supply- and demand-side effects on inflation in the medium term. The bank is taking measures to reduce inflationary effects and ensure the tightness required to contain the inflationary effects of the developments.
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