Mahfi Eğilmez reacts to Şimşek's 'success' claims: 'We are returning to where we started'

Former Treasury Undersecretary and economist Mahfi Eğilmez said, "My year-end inflation forecast is between 35-40 percent. I still stand by that. Growth will struggle a bit. Fourth-quarter growth forecasts appear to be negative.

Not all increases made by the public sector are below the revaluation rate. It may not fall very quickly.

One of the reasons for the rapid rise in inflation was suppressed school fees and rents; once they were liberalized, they reached the level they were supposed to reach, and there will be a downward effect from there. But I don't think it will fall too much," he said.

Here are the highlights from Eğilmez's statements in summary:

"My year-end inflation forecast is between 35-40 percent. I still stand by that. Growth will struggle a bit. Fourth-quarter growth forecasts appear to be negative. Not all increases made by the public sector are below the revaluation rate. It may not fall very quickly. One of the reasons for the rapid rise in inflation was suppressed school fees and rents; once they were liberalized, they reached the level they were supposed to reach, and there will be a downward effect from there. But I don't think it will fall too much.

"HE SEES SUCCESS"

From Mehmet Şimşek's perspective, it looks like success. He is bringing it down from where he took it. We need to look at who created the failure before him. If we achieve an average of 1.5 percent, we are returning to where we started this in 2021 by the end of the year. Maybe after that, we can talk about success. The base effect and the effect of raising interest rates are involved in the decline in inflation.

"I THINK TURKSTAT SHOULD BE INDEPENDENT"

A 2.5-point cut in interest rates is appropriate. In a place where inflation is 44-something, an interest rate of 47.5 is quite normal. As inflation falls, the interest rate should follow from behind, remaining a few points above it. When inflation enters an upward trend, the interest rate should rise, remaining ahead of it.

TURKSTAT needs to create a Wage Earners' Cost of Living Index. Wage increases could be made according to that. The ITO's index only covers Istanbul. TURKSTAT has a basket consisting of 400-something goods. You could produce a sub-index from the current CPI and use that. I think TURKSTAT should be independent and based entirely on merit."

News Source: 12punto