Turkey's yearly inflation decreases to a 44-month minimum of 33.5% in July.
In a welcome relief for the Turkish economy, the latest official data from TurkStat reveals that Turkey's annual consumer inflation rate eased to about 33.5% in July 2025. This marks a significant decrease from the 35% recorded in June and a substantial drop from the 44% at the end of 2024. The monthly inflation rate for July was 2.06%, below expectations.
The report highlights the sectors with the highest price increases in July. Housing topped the list with a 5.78% rise, followed closely by alcoholic beverages and tobacco (5.69%) and transport (2.89%). Conversely, the lowest annual increases were in Clothing and footwear (10.67%).
The broad headline inflation estimate masks variations, but food inflation was reported at 28%, and core goods inflation at 20.7%. Interestingly, service inflation and core goods inflation are generally lower than food and housing sectors.
Economic experts and financial institutions like BBVA Research have revised Turkey's 2025 year-end inflation forecasts slightly downward (from 31% to 30%) in light of these figures. They expect continued gradual disinflation supported by cautious monetary policy easing later this year.
However, concerns about the reliability of official TurkStat inflation data persist, as independent groups such as ENAG report significantly higher inflation rates (around 65% annually).
Despite these concerns, the July figure of 33.5% is the lowest since November 2021, when it was 21.31%. Other sectors with notable increases include Communications (19.62%) and Health (37.49%). Education recorded the highest annual price increase at 75.5%.
ENAG's June figures showed monthly inflation at 3.05% and annual inflation at 68.68%. In July, monthly inflation rose to 3.75%, while annual inflation remained high at 65.15%. This is lower than the June rate of 35.05%.
In conclusion, the July inflation figures represent a step in the right direction for Turkey's economy. However, the high annual inflation rates, particularly as reported by ENAG, underscore the need for continued vigilance and careful monetary policy to ensure sustainable economic recovery.
- The decrease in Turkey's annual consumer inflation rate to 33.5% in July 2025, as indicated by TurkStat, suggests a positive shift in the Turkish economy, especially in the areas of finance, business, and general-news.
- The sectors with the highest price increases in July included Housing, alcoholic beverages and tobacco, and transport, according to the report, while Clothing and footwear saw the lowest annual increases.
- Economic experts and financial institutions like BBVA Research have revised Turkey's 2025 year-end inflation forecasts downward due to these figures, expecting continued gradual disinflation and monetary policy easing later in the year.
- Despite the welcoming decrease in official inflation rates, concerns about the reliability of these figures persist, as independent groups like ENAG report significantly higher inflation rates, raising questions about the sustainability of Turkey's economic recovery.
