Inflation to decline in second half of 2015, says Turkish Central Bank head

The decline in inflation will become more pronounced during the second half of the year after a partial correction in food prices, Turkish Central Bank Governor Erdem Ba?ç? said on April 18, according to the Bank's website.

Speaking at a presentation to investors during the spring meetings of the International Monetary Fund and World Bank in Washington D.C., Ba?ç? said the decline in inflation excluding energy and food has continued in recent months.

"Cautious monetary policy along with prudent fiscal and macro prudential policies are having a favorable impact on core inflation trends," he said.

However, Ba?ç? noted that elevated levels and high volatility in food prices continued to weigh on headline Consumer Price Index (CPI) inflation.

"We expect a partial correction in food prices in the second half of the year... Weather conditions are more favorable this year compared to 2014. The Food Committee was established and began working," he said.

In early December 2014, the Food and Agricultural Products Markets Monitoring and Evaluation Committee was established to monitor food pricing.

Ba?ç? said Turkey's relative real GDP per capita had been increasing during the disinflation period since 2014.
Food inflation represents 14 percent of overall inflation in the country. The World Bank has forecast Turkey's inflation rate to hit 7 percent at the end of 2015. The government's inflation target is 6.3 percent for the year and 5 percent for next year and 2017.

Consumer prices in the country rose 1.19 percent in March, bringing the annual inflation rate to 7.61 percent from 7.55 percent in February, according to the Turkish Statistical Institute.

The decline in inflation is boosted by the decline in...