Turk December inflation lower than anticipated

ANKARA (Reuters) – Turkish inflation came out lower than expected in December, official data showed yesterday, but year-end consumer price inflation of 8.39 percent was still more than double an official target of 4 percent. But analysts said the data would probably not encourage the central bank to change its cautious stance on interest rates, given this week’s sharp rises in oil and other commodity prices. The Turkish Statistics Institute said the consumer price index was up 0.22 percent month-on-month in December, compared with a Reuters poll forecast of a 0.30 percent rise. The producer price index rose 0.15 percent in the month for an annual rise of 5.94 percent, with the month-on-month rise lower than a median poll forecast of 0.39 percent. Price rises in December had been expected to be modest because of the pre-New Year’s Day sale season in clothing and shoes stores. Inflation remains a source of concern for the central bank, which has cut rates four times since September while saying that food and energy prices remain risks to the inflation outlook. In November, tax hikes on fuel and tobacco had boosted annual consumer price inflation to 8.40 percent. Consumer prices had risen 1.95 percent month-on-month while producer prices rose 0.89 percent in the month. The lira was unchanged on the December data.