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Turkey's annual inflation rate surged to 36.1% last month.
its highest in the 19 years Tayyip Erdogan has ruled, laying bare the depths of a currency crisis engineered by the president's unorthodox interest rate-cutting policies.
In December alone, consumer prices took a rare step into double-digits, rising 13.58%, Turkish Statistical Institute data showed on Monday, eating deeper into the earnings and savings of Turks rattled by the economic turmoil.
The year-over-year CPI outstripped a median Reuters poll forecast of 30.6% with staples such as transportation and food - which took increasing shares of households' budgets during 2021 - rising even faster.
Source: reuters.com
Last month, Mr Erdogan announced measures to safeguard lira deposits against volatility after the Turkish currency hit an all-time low of 18.36 against the dollar.
The lira rebounded following the announcement but has since lost some of those gains.
The lira depreciated by around 44% against the dollar last year.
Mr Erdogan insists on lowering borrowing costs to boost growth, even though economists argue that higher interest rates is the way to tame soaring prices.
Also on Monday, Mr Erdogan announced that Turkey's exports increased by 32.9% in 2021, to reach "a record" 225.4 billion US dollars.
Addressing a group of exporters in a televised speech, Mr Erdogan said the figure amounted to a 7.8% narrowing of Turkey's trade deficit.
Turkey would revise its export target for 2022 to 250 billion US dollars, he added.
Weakened lira
Inflation has been rising in the country while the Turkish lira has been slumping to record lows after the country's central bank — under pressure from President Recep Tayyip Erdogan — cut a key interest rate by 5 percentage points in September.
The weakened lira has made imports, fuel and everyday items more expensive and has left many in the country of some 84 million struggling to buy food and other basic goods. Many have been purchasing foreign currencies and gold to protect their savings.
Last month, Erdogan announced measures to safeguard lira deposits against volatility after the Turkish currency hit an all-time low of 18.36 against the dollar. The lira rebounded following the announcement but has since lost some of those gains. The lira depreciated by around 44% against the dollar last year.
The central bank has argued that temporary factors had been driving prices and forecast a volatile course for inflation, which - having been around 20 percent in recent months and mostly double-digits over the last five years - it said in October would end the year at 18.4 percent.
Sengul suggested that, with Monday's data, that argument had run its course.
"This reflects a vicious cycle of demand-pull inflation, which is very dangerous because the central bank had implied the price pressure was from cost-push (supply constraints), and that it couldn't do anything about it," she said.
Reflecting soaring import prices, December's producer price index rose 19.08 percent month-on-month and 79.89 percent year on year. Annual transportation prices soared 53.66 percent while the food and drinks basket jumped 43.8 percent, the CPI data showed.
The economic turmoil has also hit Erdogan's opinion polls ahead of a tough election scheduled for no later than mid-2023.
The lira touched a record low of 18.4 against the dollar in December before rebounding sharply two weeks ago after state-backed market interventions, and after Erdogan announced a scheme to protect lira deposits against currency volatility.
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