Turkey's Central Bank expects the inflation to drop sharply in the upcoming months. In April the inflation will peak before falling rapidly, Central Bank Gov. Erdem Basci said in a presentation to the Cabinet yesterday, according to the Anatolian News Agency.
The law in Turkey states that twice a year the governor has to give a briefing about monetary policy that has been implemented or will be implemented regarding banking activities.
"The inflation rate is expected to reach its peak in April, however we are expecting an important drop in May. Rates will keep falling faster toward the end of the year," he said at the first mandatory briefing for this year.
Basci also said that the current account deficit has gone through its worst phase after reaching its highest in October 2011 and the narrowing of the current account gap will continue in Turkey. The central bank is also optimistic for Turkey's growth in 2012.
It is better to change the posture of monetary policy rather than revise the inflation rate predictions, according to Basci. Turkey's monetary policy decisions are aimed to help the inflation rate reach the "5% target" by mid 2013, he added.