CBT: Core inflation trend may edge up in September, driven by services and food

The Central Bank of the Republic of Türkiye (TCMB) warned on Friday that leading indicators point to a modest rise in the core inflation trend for September, with services and food price developments most likely to push consumer inflation higher.

In a summary of the Monetary Policy Committee (PPK) meeting held on Sept. 11 — at which the policy rate was cut by 250 basis points — the bank said early data show services and food will be the main contributors to headline inflation this month.

Key points from the TCMB summary:

• Monthly services inflation, adjusted for seasonal effects, is expected to increase led by the back-to-school effect.

• Leading indicators suggest food prices are evolving relatively negatively, partly due to drought-related supply constraints.

• Unprocessed food inflation is being driven by movements in vegetables, white meat and eggs. Processed food inflation is rising mainly because of higher prices for items such as edible oils and dairy products.

• Price increases for non-food consumer items have been more moderate so far.

The bank’s assessment underscores the difficulty of achieving a sustained disinflation path while domestic supply shocks and seasonal demand pressures persist. TCMB reiterated that it is monitoring incoming data closely as it evaluates the outlook for inflation and monetary policy.