Page 33 - TURKRptOct19

To be fair, the government has already managed to keep the exchange rate under control for longer than expected, except for a “negligible flash crash”.
If the end of this story of Turkish economic hubris does not prove to be dramatic, treatises on economics will have to be rewritten in line with 'Erdoganomics' as throughout history, all around the world, all attempts at pressing down on both the exchange rate and interest rates have ended in hyperinflation.
Tamed real food prices in the upcoming winter season would also prove a game-changer in economic history, with a chapter reserved for the government intervention in the market since last winter, which has even involved the state setting up its own food and veg stalls with prices to scare the living daylights out of private retailers.
At the bottom of its September 3 story on the latest Turkish inflation rate, Reuters had a sub-headline reading “Data Questioned”.
“But a string of better-than-expected data in recent months, including lower inflation than forecast in four of the last five months, has led to criticism by the main opposition party, the Republican People's Party. It filed a motion in parliament in June claiming a TUIK methodology adjustment damaged credibility. On September 3, Republican People's Party spokesman Faik Oztrak said on Twitter that 'despite all the price hikes' monthly CPI was only 0.86%. TUIK 'should do the nation a favour and announce the addresses of where it takes the prices from. Our nation should not be deprived of these cheap and reasonable prices,' he wrote..."
"Enflasyon" - the Turkish word for inflation - was among the country's top trending topics on Twitter on September 3, the Reuters note added.
However, the report ended by tying the freefalling official inflation to “the so- called base effect”. The author will avoid an ultimatum from the Turkish government.
The Bloomberg story on Turkish inflation did not mention the pricing controversies. Some of the news agency's staff members have a court hearing this month where they will face the allegation of “attempting to undermine Turkey's economic stability”.
Ending up in prison due to undermining something that does not exist is a common occurrence in the Realm of Erdogan.
The argument of the government and its proponents suggests that Turks are idiots who do not understand the high-level mathematics that underpin the descent of inflation. Prices cannot be booming, although, of course, they are.
Esoteric economic rules such as declining demand are also said by officials to explain the fall in inflation. The fact that people are abandoning using utilities because utility prices have more than doubled has not yet been explained.
Turkey’s state-run pipeline company BOTAS hiked natural gas prices by 14.97% as of August 1 and by another 14.97% as of September 1.
Tax breaks for vehicles, white goods and furniture, meanwhile, expired at the end of June, sparking more price increases, despite sales collapsing.
“Pretty remarkable disinflation process going on - but a reflection, I think, of the depressed state of domestic demand. Firms just lack pricing power. Add in herein very favourable base period effects. Very possible to see single digit inflation by October, but then rising slightly to year end. Erdogan is always a
33 TURKEY Country Report October 2019 www.intellinews.com