CBRT Lifts 2026 Inflation Forecast to 26% as War and Energy Shocks Darken Outlook
Updated
Updated · continuumeconomics.com · May 14
CBRT Lifts 2026 Inflation Forecast to 26% as War and Energy Shocks Darken Outlook
10 articles · Updated · continuumeconomics.com · May 14
26% is the CBRT’s new end-2026 inflation forecast, with projections set at 15% for 2027 and 9% for 2028 in its second quarterly inflation report.
Regional war, higher energy prices and wider global uncertainty drove the revision, and Governor Fatih Karahan said the inflationary impact of tensions on energy supply should stay pronounced in the short term.
The bank said tight monetary policy is still cooling services and core goods inflation, but food and energy pressures remain key risks to the disinflation path.
CBRT also dropped forecast ranges in favor of point forecasts for its baseline scenario, reflecting elevated market uncertainty as it maps a gradual return toward its 5% medium-term goal.
Can Turkey's central bank restore credibility while inflation targets rise and war rages next door?
With the Strait of Hormuz blocked, how long can the world's oil reserves prevent a global recession?
As US-Iran peace talks falter, what is the next move to avert a wider regional conflict?
Turkey’s Inflation Outlook 2026: Geopolitical Shocks, Energy Dependence, and Policy Credibility at a Crossroads
Overview
Turkey is facing a serious inflation problem, with recent data showing a higher-than-expected rise in prices. This has led market participants to expect even higher inflation in the future, with forecasts for 2026 already at 27.53% and likely to increase further. The Central Bank of the Republic of Türkiye has revised its own inflation outlook, bringing it closer to market expectations, but it remains more optimistic than most analysts. The main driver behind these inflation pressures is global energy market volatility, which continues to push up costs and make it harder for Turkey to control inflation.