FX.co ★ Turkish Inflation Slows Beyond Forecasts

Turkey's annual inflation rate eased to 35.41% in May 2025, down from 37.86% in April and falling below market predictions of 36.1%. This signifies a year-long trend of declining consumer inflation, reaching the lowest point since November 2021, as the pace of price increases decelerated across nearly all sectors. Particularly, inflation decreased for food and non-alcoholic beverages, dropping to 32.87% from April's 36.09%, and for housing and utilities, down to 67.43% from 74.07%. Similar downward trends were observed in furnishing, household equipment, and routine maintenance, which fell to 29.69% from 30.54%; clothing and footwear, which decreased to 14.12% from 16.92%; and hotels, cafes, and restaurants, which dropped to 36.91% from 41.87%. Conversely, transport was the only sector to experience an uptick, rising to 24.59% from 22.76%. Core inflation also saw a reduction, reaching 35.37%—its lowest since December 2021—down from 37.12% the previous month. On a monthly scale, the Consumer Price Index (CPI) increased by 1.53%, marking the smallest rise in five months, following a 3% hike in April and under the expected 2% rise.