UPDATE 1-Turkish cbank says power price hikes to push up CPI
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ISTANBUL, July 4 (Reuters) - Large Turkish electricity price hikes at the start of July will push consumer price inflation up 0.5 percentage points, the Turkish Central Bank said on Friday.
In its regular monthly statement on inflation data, the bank reiterated that it expected inflation to remain high due to base effects before falling gradually from the fourth quarter.
Turkish consumer prices showed a surprise fall in June amid a sharp decline in food prices, official data showed on Thursday. The figures were not seen changing expectations of further interest rate hikes to come.
Energy and food prices have driven a recent rise in inflation but the central bank said there had been a correction in unprocessed food prices in June.
"It is expected that annual inflation will remain high in the coming months due to base effects and that it will gradually enter a falling trend from the fourth quarter," the bank said.
The consumer price index fell 0.36 percent month-on-month in June, compared with a Reuters poll forecast for a 0.40 percent rise, giving a year-on-year increase of 10.61 percent, the Turkish Statistics Institute said.
The producer price index rose 0.32 percent on the month, lower than a predicted 1.00 percent rise, for an annual increase of 17.03 percent.
Last month, the bank raised interest rates by 50 basis points and said it could tighten further amid concerns about the inflation outlook. Continued...
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