Inflation statement from Mehmet Şimşek: 'It will get back on track'

Making statements regarding the economic agenda at the Banks Association of Turkey's general assembly, Treasury and Finance Minister Mehmet Şimşek said that the country's economy has faced various challenges over the last two years but has emerged from this period strongly. Şimşek underlined that price stability is at the center of the economic program and that there is no question of compromising on this.

Emphasizing that it is normal to experience some delays in the progress of economic programs, Minister Şimşek stated that they will continue to support the process with both fiscal policies and structural reforms to permanently reach single-digit inflation. Şimşek said, "I am sure that we will achieve this, even if it is a little delayed. With a delay of a few months, the disinflation process will continue again and will get back on track."

Another issue highlighted by Minister Şimşek was the sliding scale system (eşel mobil) recently put into effect. Stating that this practice makes it difficult to reach targets during the inflation process, Şimşek pointed out that year-end budget targets will still be met: "Even though we have implemented a very critical practice like the sliding scale system this year, we will meet our budget target this year. If it weren't for the sliding scale system, we would be talking about success beyond our targets."

In addition, drawing attention to the fact that global developments and geopolitical risks are putting pressure on the country's economy, Şimşek emphasized that this process is challenging not only for Turkey but also for many countries around the world.

Another topic addressed by the economic management was the course of the current account deficit. Şimşek reported that there have been significant structural improvements in the current account deficit in recent years.

The highlights of Şimşek's speech were as follows: - "Not only the banking sector, but our economy has shown its resilience against strong shocks in the last 2 years. These did not happen by chance; price stability is very important to us and is the most critical component. Price stability forms the foundation of the program." - "We have built fiscal discipline, and it is important to maintain it from now on." - "There has been a structural improvement in the current account deficit in recent years." - "We will provide the necessary support with the fiscal pillar and the reform pillar to permanently reduce inflation to low single digits; I am sure we will achieve this, even if it is a little delayed." - "With a delay of a few months, the disinflation process will continue again and will get back on track." - "Even though we have implemented a very critical practice like the sliding scale system this year, we will meet our budget target this year. If it weren't for the sliding scale system, we would be talking about success beyond our targets."