By Joshua Kirby
Turkish inflation continued to ease last month, though a little less than expected, likely keeping the country's central bank cautious as it mulls how long to keep interest rates at their current heights.
Consumer prices were 47.1% higher on year in November, losing a little pace from 48.6% a month earlier, the country's statistics agency said Tuesday. Economists had expected annual inflation to fall to 46.4%, according to a poll compiled by FactSet.
The decline marks half a year of continuously lower inflation, a sign that the central bank's tight monetary policy is bearing fruit. Falling inflation has been accompanied by a slowing economy, with Turkey sliding into a technical recession of two straight quarters of contraction between March and September, according to figures published last week by the agency.
The central bank last month held its key rate at 50%, keeping some of the highest borrowing costs of any major world economy, but noted that there are positive signals regarding the battle to tame inflation. "The disinflation process will gain strength," the bank said.
While that trajectory might leave the door open for the central bank to start lowering borrowing costs at coming policy meetings, cutting rates too early would damage policymakers' hard-won credibility, said Timothy Ash, an economist specializing in Turkey, at the time.
Write to Joshua Kirby at joshua.kirby@wsj.com; @joshualeokirby
(END) Dow Jones Newswires
12-03-24 0230ET
