Turkey’s consumer price index (CPI) inflation officially edged down to 30.65% y/y in January from 30.89% at end-2025, the Turkish Statistical Institute (TUIK, or TurkStat) said on February 3.

Official inflation stood at 44% y/y at end-2024. It hovered around 33% between July and October 2025.

It is not advisable to plan, price or draw inferences based on TUIK data. There is widespread concern about the reliability of Turkey’s official data series.

At 31%, Turkey remains in fifth place in the world inflation league.

January effect on monthly rate

TUIK also posted a monthly official inflation figure of 4.84% after releasing 0.89% for December, 0.87% for November, 2.55% for October, 3.23% for September, 2.04% for August, 2.06% for July, 1.37% for June, 1.53% for May and 3.00% for April.

The January 2025 figure was released at 5.03%. The first month of the year always produces annual price increases that lift inflation.

Revision to solve "above-30%" deadlock

With the January 2026 data, the TUIK has changed the base year in its official CPI series to 2025 from 2003. It has also employed wide-scope changes in its methodology and inflation basket.

The revision, which is entirely in line with Eurostat guidance, is supposed to solve the "above-30%" deadlock with the February release.

Above 20% at end-2026

On February 12, the central bank will release its next quarterly inflation report, the first such report of 2026. It will include updated forecasts.

For end-2026, the authority’s “forecast range” remains at 13-19%, with the “interim target” standing at 16%.

In the February report, an upgrade for the end-2026 numbers is not anticipated, while it is almost certain that they will move up across the year.

As things stand, the realisation is supposed to come in at above the 20%-level.

March 12, second rate cut of 2026

On January 22, the monetary policy committee (MPC) of Turkey’s central bank cut its main policy rate (one-week repo) by 100 bp to 37% at its first rate-setting meeting of 2026.

On March 12, the MPC will hold its second rate-setting meeting of the year. Another rate cut is a near certainty. Uncertainty, however, abounds as to the likely size of the cut.

As things stand, another 100-150bp cut is on the cards.

The central bank will hold eight rate-setting meetings in 2026. A 100-150bp rate cut on average per meeting, making for a combined cut of 1,000bp, would bring the policy rate down to 28% at end-2026. Such a path is to be expected.

Dashboard check

On the economic dashboard, the USD/TRY pair remains under control. Turkish borrowers’ eurobond auctions remain strong. Turkey’s five-year credit default swaps (CDS) are testing the 200-level. On the loans side, high debt rollover rates and low costs are observed.

After a local court dropped the case targeting the headquarters of the main opposition Republican People’s Party (CHP) in October, political stress that was bugging the finance industry dissolved.