Chart of the week: inflation in Turkey at its highest in 15 years

Inflation in Turkey has soared to its highest level since 2003. In August, the annual rate of consumer price inflation had reached around 18% but in September it was almost 25%.

917_COTW

Inflation in Turkey has soared to its highest level since 2003. In August, the annual rate of consumer price inflation had reached around 18% but in September it was almost 25%. Food prices rose by 6.4% in September alone.

Turkish consumers have been facing severe double-digit inflation for almost two years now, largely thanks to the currency crisis, which has sent the prices of imported goods sky-high.

A failed coup against President Recep Tayyip Erdogan, his authoritarian tendencies and his criticism of the central bank which he insists should keep interest rates low have all caused investors to lose confidence in the country's political and economic stability. The lira has lost half its value against the dollar since 2016.

Viewpoint

"When Elon Musk, the founder of Tesla, announced in August he had plans to take the company private, the news did not come as a complete shockresearch has alleged that leaders of publicly-listed companies find it hard to implement a long-term vision, say by developing investment plans, because of the pressures of quarterly earnings reports But there is a catch: the data on company activity may not support [this view US data covering] 2.7 million firm-years' suggests that listed groups actually invest 48.1 percentage points more not less than private ones, after adjusting for sector and size. More remarkable still... when privately held companies went public, their R&D-to-physical-asset ratios increased by 34.5 percentage points, and their "R&D-to-total investment shares by 17.1 percentage points". When publicly listed companies went private, however, there was a reduction in R&D investments'".

Gillian Tett, Financial Times

Recommended

Weak inflation data may gives the Bank of England an excuse to cut rates
Economy

Weak inflation data may gives the Bank of England an excuse to cut rates

UK inflation is edging lower, and is now well below the Bank of England’s 2% target rate. That could mean even lower interest rates. Here's why. 
15 Jan 2020
How long can the good times roll?
Economy

How long can the good times roll?

Despite all the doom and gloom that has dominated our headlines for most of 2019, Britain and most of the rest of the developing world is currently en…
19 Dec 2019
The MoneyWeek Podcast: Negative interest rates, armed guards and a warehouse full of cash
Global Economy

The MoneyWeek Podcast: Negative interest rates, armed guards and a warehouse full of cash

Merryn and John discuss the extraordinary idea of negative interest rates and explain why as far as they can see they just don't work. Plus, a genius …
15 Oct 2020
What would negative interest rates mean for your money?
UK Economy

What would negative interest rates mean for your money?

There has been much talk of the Bank of England introducing negative interest rates. John Stepek explains why they might do that, and what it would me…
15 Oct 2020

Most Popular

Negative interest rates and the end of free bank accounts
Bank accounts

Negative interest rates and the end of free bank accounts

Negative interest rates are likely to mean the introduction of fees for current accounts and other banking products. But that might make the UK bankin…
19 Oct 2020
UK post-Covid recovery stocks: these 20 companies could be set to rocket
Share tips

UK post-Covid recovery stocks: these 20 companies could be set to rocket

Finding stocks with the potential to rise tenfold or even further is far easier said than done. But the pandemic has produced the most promising backd…
22 Oct 2020
Big spending government is here to stay – just ask Rishi Sunak
UK Economy

Big spending government is here to stay – just ask Rishi Sunak

Governments around the world are splashing huge amounts of cash as they do “whatever it takes” to prop up their economies. John Stepek looks at where …
23 Oct 2020