October inflation edged up to 29.77% and monthly prices rose 2.58%, leaving markets divided on whether the central bank will cut again at its December 10 meeting.
MoneyTurkey Economics Desk | 4 November 2026
Key points
- Annual CPI rose to 29.77% in October from 29.73% in September; the monthly rise of 2.58% beat the roughly 2.4% consensus.
- The policy rate is 36% after a 100 basis-point cut on Oct. 22, the first since January.
- ING expects another cut in December; BBVA Research, Goldman Sachs and Akbank expect no change.
The Turkish central bank cut its one-week repo rate by 100 basis points to 36% on Oct. 22, citing a slowdown in the underlying trend of inflation. October data released this week showed the annual rate edging up to 29.77% and a monthly increase of 2.58%, above market forecasts. That mix has left analysts split on whether easing continues on Dec. 10.
What happened
The Oct. 22 move was the first policy cut since January. The Monetary Policy Committee said recent inflation figures and leading indicators still pointed to a deceleration in the underlying trend, while flagging elevated energy prices as an upside risk.
Official data from the Turkish Statistical Institute put annual inflation at 29.77% in October, up from 29.73% in September, when the rate first fell below 30% in nearly five years. The monthly reading of 2.58% exceeded consensus, with pressure from food, energy and clothing prices. MoneyTurkey covered the print on Nov. 3; this piece tracks the December policy split that followed.
What the numbers say
ING researchers said the downward trend in inflation has stalled but still viewed the October data as unlikely to alter the central bank’s easing path.
BBVA Research cited high energy prices and pressure on reserves as reasons to expect rates to stay unchanged in December.
Goldman Sachs, according to a Matriks Haber poll of banks and research desks, also sees no cut, pointing to an acceleration in seasonally adjusted inflation and a decline in reserves.
Akbank is keeping its year-end policy-rate forecast at 36% and does not anticipate a December reduction. Other local desks in the same poll, including İş Yatırım and Gedik Yatırım, still lean toward another 100 basis-point cut if November inflation cooperates.
Why it matters
The December decision now hangs on three near-term inputs: the quarterly inflation report due on Nov. 12, the November CPI print, and the path of energy prices and reserves. ING still expects annual inflation to finish the year below 30%; BBVA has kept its 2026 forecast at 30%.
For rates markets and the lira, the split matters more than the 0.04 percentage-point rise in the annual rate. A hold at 36% would mark a pause after the first cut of the cycle; another cut would signal that the bank still trusts the disinflation path despite a hot monthly print.
What to watch
- Nov. 12 quarterly inflation report
- November CPI
- Energy prices and reserve levels ahead of Dec. 10
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For information only. Not investment advice.
Sources
- Daily Sabah (Nov. 4, 2026): dailysabah.com
- CBRT Press Release on Interest Rates No. 2026-45 (Oct. 22, 2026): tcmb.gov.tr
- Trading Economics / TurkStat October CPI summary: tradingview.com
- Matriks Haber analyst poll via CNBCE (Nov. 2026): cnbce.com
