Inflation Report - July 2025
Alper Gürler
alper.gurler@isbank.com.trH. Erhan Gül
erhan.gul@isbank.com.trDilek Sarsın Kaya
dilek.kaya@isbank.com.trBüşra Ceylan
busra.ceylan@isbank.com.trCPI rose by 2.06% in July.
Monthly CPI inflation reached the highest level in the last three months with 2.06% in July. However, it was still below market expectations of 2.40%. Annual CPI inflation continued to decline due to the high base effect, falling to 33.52%.
Monthly domestic PPI inflation, which fell from 2.46% to 1.73% in July, dropped below CPI inflation again after two months. In this period, the annual D-PPI inflation came in at 24.19%.
Expectations
In July, although consumer inflation gained momentum compared to June due to the increase in administered prices as well as the natural gas price adjustment, it remained below market expectations. The fact that core inflation indicators remained below headline inflation provided positive signals regarding the course of inflation as well. We expect that the high base effect will continue to support disinflation in the coming months, albeit at a slower pace, and that annual CPI inflation will remain around the upper band of the CBRT's forecast range at the end of the year.
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