Inflation to hit 30% by year-end, single digits expected in 2025, says Simsek

Minister of Treasury and Finance Mehmet Simsek asserted at the “Financial Literacy Platform Launch” that a rapid decline in inflation could be expected in the latter half of the year.

Additionally, he cautioned citizens regarding their investments in the stock market.

Providing crucial insights into the economy, Minister Simsek acknowledged that while inflation would continue its ascent in May, it would likely recede to the 30% by year-end.

“Our ongoing efforts to curb inflation are yielding success. A reduction in inflation will significantly bolster capital markets,” Simsek said,  emphasizing the paramount importance of reducing inflation to single digits.

Inflation to reach its peak this month

Simsek predicted a further rise in annual inflation for May.

“Monthly inflation figures are beginning to align with our targets,” Simsek stated, noting that while May’s annual inflation may see a rise compared to last year’s figures, it is expected to peak in May.

He attributed this trend to base effects in the summer months and emphasized the government’s strategic measures in monetary, fiscal and income policies to combat inflationary pressures.

Inflation to dip to 30% by the end of the year

Anticipating a downturn in inflation in the latter part of the year, Simsek affirmed that inflation would retreat to the 30s by the end of the year.

“With favorable seasonal factors in the summer months, alongside our strategic monetary and fiscal policies, supported by income policies, inflation is poised to swiftly decline to the 30s by year-end.”

Single digits next year, followed by further reduction

Simsek outlined its strategy to lower inflation to single digits by 2025 and subsequently to lower single digits by 2026.

“We aim to achieve price stability by maintaining inflation at low single digits,” Simsek emphasized, highlighting the government’s commitment to ensuring sustained economic stability and growth.

“Next year it will be in the 10s (inflation) and the year after that it will be in single digits. And then to bring it down to low single digits and keep it there. We call this price stability,” he added.

The Minister’s optimistic projections underscore Türkiye’s proactive approach to economic management and its determination to address inflationary challenges.

These forecasts aim to instill confidence among investors and stakeholders, signaling a promising path for Türkiye’s economic recovery and long-term prosperity.

‘Stock market not aplayground’

“While citizens may view it as a game, involvement in the stock market is far from recreational,” Minister Simsek warned citizens about their unconscious activities in the stock market.

“Engaging in the stock market constitutes an investment. When purchasing shares, individuals acquire ownership in a company, albeit not its entirety. It’s essential to base decisions on informed analysis, particularly for those without stock market accounts or involvement in cryptocurrencies. Choices made should rely on substantiated information rather than hearsay,” Simsek added.

Citizens should avoid acting on tips and rumors

Simsek urges citizens to recognize that avenues promising quick financial gains often entail high risks and potential hazards.

“Remember, high returns typically correlate with elevated risks. Beware of purported insider tips promising substantial returns, as they often involve considerable risk. Make decisions based on thorough analysis rather than relying on speculative information,” he said.