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Former IMF Economist Lecturer. Prof. Burcu Aydın Evaluated the Inflation Data
Former IMF Economist and Bilkent University Faculty Member Burcu Aydın Özüdoğru commented on the inflation data...
Yazar: James Gordon
Yayınlanma: 4 Ekim 2022 04:10
Güncellenme: 23 Nisan 2024 20:40
Former IMF Economist Lecturer. Prof. Burcu Aydın Evaluated Inflation Data
Former IMF Economist and Bilkent University Faculty Member Burcu Aydın Özüdoğru commented on the inflation data: "We should definitely not characterize the decrease in the annual inflation rate as a decrease in inflation."
Former IMF economist and Bilkent University Faculty Member Burcu Aydın Özüdoğru participated in Bloomberg HT broadcast and made evaluations about inflation. Özüdoğru said, "One of the processes in the high inflation period is that the differences in expectations and measurement are quite wide. For example, if we look at the consumer side of the announced figures, the monthly inflation increase announced by the Turkish Statistical Institute was at the lowest rate with 3 percent, while the Istanbul subsistence index announced by the Istanbul Chamber of Commerce showed the highest rate with 6 on a monthly basis. One of our biggest dangers for the period ahead is the loss of the anchor of inflation. In other words, the fact that there is such a different spectrum in expectations, that there is a difference of about one hundred percent between the lowest band and the highest band, that both producers and consumers have a different understanding of pricing, means that the trend in inflation will continue. Both the exchange rate, inflation dynamics and the course of expectations show us that inflation rates will continue to increase by at least 3 percent on a monthly basis. The decline in annual inflation that we will see only in the last month of the year and the first months of next year is only a base effect. Unfortunately, the increase in prices will continue to pull down the purchasing ability. Commenting on the 83.5 percent increase in the CPI compared to the 151.50 percent increase in the PPI on an annual basis, Özüdoğru said, "The gap has widened quite differently. In CPI, the transportation group was effective as global oil prices came down. On the other hand, issues such as the fact that we cannot see the item prices in the announced statistics raise questions about how and on what basis these prices are determined. The fact that producer prices are increasing at such a high rate suggests that this will be reflected on the consumer side gradually and consumer prices will continue to rise. Although the current interest rate policy is trying to control the increase in prices through restrictions on credit, in essence, the fact that an open-ended interest rate is applied on the savings side, pulling consumption forward and creating various bubbles in asset prices, shows signs that prices will continue to increase in the coming period. High inflation reduces consumers' ability to spend. It creates uncertainty in the market. This can naturally lead to a decline in economic activity after a certain period of time and employment losses in the economy can have much harsher effects. Unfortunately, with the contraction in financial access, negativity in domestic demand and signals of a slowdown in foreign demand, we will see signs of a sharp contraction in economic activity in the last months of the year. As we enter the election economy, we are likely to see steps that will increase price pressure and further deteriorate consumer behavior in the coming months. Increases in the minimum wage are likely to melt rapidly in terms of inflation." Follow Global Economic Developments on Social Media! Click here to follow Ieconomy official Facebook account! Click here to follow Ieconomy official Instagram account! Click here to follow Ieconomy official Twitter account!İLGİLİ HABERLER
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