Turkey central bank increases year-end inflation view to 12.2%

Turkey central bank increases year-end inflation view to 12.2%

Women look at a foreign currency board inside a currency exchange shop in Ankara, Turkey. Associated Press Turkey's central bank raised its year-end inflation forecast on Thursday to 12. 2 per cent from 9. 4 per cent, in part due to pressure from lira depreciation, and its new governor said tight policy would be maintained until price pressures decline. Presenting a quarterly inflation report for the first time since he was appointed last month, Governor Sahap Kavcioglu said the policy rate, now at 19%, would be set above inflation, which topped 16 per cent last month and is expected to head a bit higher. Kavcioglu sought in the presentation to convince economists that he would be as decisive as his predecessor, Naci Agbal, a respected policy hawk, in bringing down inflation to a 5 per cent target over the next three years. Yet his shock appointment as bank chief last month, which initially sent the lira down as much as 15 per cent, has raised inflation via imports and piled pressure on the bank to maintain tight policy even though Kavcioglu has in the past urged cuts."We have given clear guidance... saying that the policy rate will be above inflation