TCMB Survey: Household Inflation Expectations Near 50% as Gold Remains Top Investment Choice

Türkiye’s central bank survey for March 2026 shows household inflation expectations rising sharply toward the critical 50% threshold, underscoring persistent price pressures and entrenched inflation perceptions. Food and energy remain the primary drivers of concern, while gold continues to dominate as the preferred investment vehicle among households.

Inflation Expectations Rebound Toward Critical Threshold

According to the Central Bank of the Republic of Türkiye (TCMB) Household Expectations Survey conducted between March 5–13 with 2,985 participants, 12-month ahead inflation expectations rose by 1.08 percentage points to 49.89%.

This marks a notable shift after two months of stability at 48.81% in January and February, suggesting that inflation expectations are becoming increasingly entrenched among households.

A significant 69.3% of respondents expect inflation to remain above current levels over the next 12 months, up from 63.4% in February and 59.3% in January.

Türkiye Web CPI Rises 2.48% in March, Annual Inflation Eases to 31.68%

Clear Divergence Across Demographics

The survey highlights notable differences in inflation expectations across demographic groups:

• Women: 52.2%
• Men: 48.1%

By age group:

• 55 and above: 51.5%
• Ages 40–54: 50.5%

Income levels also play a role:

• Minimum wage and below: 51.8%
• Twice minimum wage and above: 48.6%

Higher education levels are associated with slightly lower expectations, with university graduates reporting a 49.1% outlook.

Gold Remains the Dominant Safe Haven

Responses to the question “What would you do if you had cash on hand?” reveal a strong and persistent preference for gold:

• Gold: 55.2%
• Real estate: 28.5%
• Time deposits: 3.5%
• Equities: 2.5%
• Foreign currency: 2.0%

Despite minor fluctuations, gold remains the dominant safe-haven asset. Interest in real estate has been declining for three consecutive months, likely reflecting high property prices and tighter access to financing.

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Food Inflation Still the Main Pressure Point

Food prices continue to dominate household perceptions of inflation.

• 40.5% of respondents identified food as the category with the highest price increases over the past year.

Although slightly lower than February levels, food inflation remains the most significant burden on household budgets.

Energy Concerns Surge Sharply

The most striking shift in March came from energy-related perceptions.

The share of respondents identifying fuel and energy as the fastest-rising category jumped from:

• 24.0% in February
  ➡️ to 30.8% in March

This sharp increase reflects the rapid transmission of global energy market volatility—particularly linked to the Iran conflict—into domestic expectations.

Looking ahead:

• Food: 36.1%
• Energy: 33.2%

The gap between the two is narrowing quickly.

Housing Expectations Ease, But Sentiment Remains Negative

Expectations for housing price increases have moderated slightly:

• January: 39.23%
• February: 35.41%
• March: 35.05%

However, sentiment remains pessimistic overall.

• 64.5% of respondents still expect housing prices to rise further
• Only 13.4% anticipate a slowdown in price increases

Dollar Expectations Move Higher Again

Exchange rate expectations also point upward:

• February: 51.56 TRY/USD
• March: 52.15 TRY/USD

After a brief dip in February, expectations have resumed their upward trend, indicating continued pressure on the Turkish lira.

Demographic differences in FX expectations remain relatively limited compared to inflation perceptions.

Outlook: Sticky Expectations Complicate Policy Path

March survey data suggest that inflation expectations in Türkiye remain elevated and increasingly persistent.

Key takeaways:

• Inflation expectations nearing the 50% threshold
• Food and energy driving perception of price pressures
• Gold maintaining its dominance as a safe haven
• Currency expectations trending higher

These dynamics highlight the growing challenge for policymakers, as managing expectations becomes as critical as controlling actual inflation.

The survey only partially reflects the psychological impact of the rising petrol prices.  If the oil supply disruptions were to continue in April, expectations can rapidly become unmoored, forcing CBRT to hike rates in its 22 April MPC meeting.