Central Bank Raises Inflation Forecasts: 2027 Projection Increased to 21%

The Central Bank of the Republic of Türkiye (CBRT) has published its Inflation Report 2026-IV. The year-end inflation forecast for 2026 has been raised to 29.5%, while the projections for 2027 and 2028 have been revised to 21% and 13.5%, respectively. Rising energy and food prices were among the main factors behind the upward revisions.

The Central Bank of the Republic of Türkiye (CBRT) released its fourth and final Inflation Report of 2026 on November 12. Presented by CBRT Governor Fatih Karahan, the report assessed Türkiye’s current economic outlook, the inflation trajectory, and economic expectations for the coming years.

INFLATION FORECASTS RAISED FOR 2026, 2027 AND 2028

According to the revised projections, the year-end inflation forecast for 2026 was increased from 28% to 29.5%. The forecast for 2027 was raised from 15% to 21%, while the projection for 2028 increased from 9% to 13.5%.

The CBRT expects inflation to decline to 9% by the end of 2029 and stabilize around its medium-term target of 5%.

ENERGY AND FOOD PRICES DRIVE UPWARD REVISIONS

Rising energy prices and increases in import prices denominated in Turkish lira were among the key factors behind the upward revision of inflation forecasts.

The Central Bank raised its average oil price assumption for 2026 from $87.8 to $97.2 per barrel. Its projection for 2027 was also increased from $76.4 to $86.7 per barrel.

The food inflation assumption for 2026 was raised to 31.3%, while the food inflation forecast for 2027 was revised to 24%.

MESSAGE OF TIGHT MONETARY POLICY

The report emphasized that a tight monetary policy stance would be maintained to achieve price stability. It also highlighted the impact of global developments, energy prices, import costs, and food prices on the inflation outlook.

The CBRT’s revised projections indicate that the anticipated improvement in the fight against inflation is expected to proceed more slowly than projected in the previous report.

Kaynak: Central Bank of the Republic of Türkiye – Inflation Report 2026-IV.