Türkiye's inflation rate slows sharply to 64.3%

Türkiye's annual inflation pulled back further in December from a two-decade high, official data showed, helping President Recep Tayyip Erdogan's chances in elections due by June.

Consumer prices rose by 64.3 percent in December from the same time last year, the state statistics agency said, compared to an 84.4-percent increase in November.

Analysts attribute the sharp slowdown to the so-called base effect, which makes price increases look smaller when compared to extremely high rates 12 months earlier.

But it fulfils Erdogan's campaign promise that inflation will start falling at the start of the year after reaching the highest levels since 1998 last year.

Erdogan hailed the data as a sign of a "rapid recovery".

"We will see that the downward trend in inflation will continue," he said in a televised address.

"Our goal this year is to completely burst the bubble of inflation and remove the issue from our country's agenda as of next year."

Türkiye's economy has been going through convulsions since Erdogan launched an unusual experiment in September 2021 that tried to fight inflation by bringing down borrowing costs.

The lira began to lose value almost immediately, as consumers rushed to buy up gold and dollars to protect their savings.

The price of imports such as oil and gas soared, creating an inflationary spiral that the nominally independent central bank fed further by continuing to lower interest rates.

A separate study released by Türkiye's ENAG research institute showed the rate slowing to 137.6 percent in December from 170.7 a month earlier.