Türkiye’s central bank raised its end-2026 interim inflation target to 24% from 16% Governor Fatih Karahan said on Thursday, forecasting that the inflationary effects related to the Iran war would remain pronounced in the short term.
Presenting the central bank’s quarterly inflation report in Istanbul, Karahan said the bank also lifted its end-2027 interim inflation target to 15% from 9%, setting its end-2028 interim target at 9%.
“While the central question before us is how long the regional tensions and pressures on energy supply will persist, we assess that the related inflationary effects will remain pronounced in the short term,” Reuters quoted Karahan as saying.
He said that how long the tension lasts is a critical risk factor in terms of the inflation outlook, adding that there would be no compromise on the bank’s determination to bring down inflation and it will continue to use all available tools for disinflation.
In the previous quarterly inflation report in February, the bank raised its year-end inflation forecast range by two percentage points to 15-21% and maintained its interim 16% target, despite market doubts about whether the downward trend seen throughout 2025 is on track.
The war-related surge in energy prices has rattled import-heavy economies like Türkiye. Monthly inflation surged to 4.18% in April and 32.37% on the year.