⁍ Turkey’s inflation is expected to tick up slightly in October to stand at 11.90%.

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⁍ A weak lira led the central bank to raise its year-end forecast this week.

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⁍ The lira’s decline, nearly 30% so far this year, has lead to higher inflation via imports priced in hard currencies.

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– Turkey’s central bank surprised the financial world this week by leaving its key interest rate unchanged at 10%, a move that sent the lira to new record lows, reports the Wall Street Journal. The bank, however, unexpectedly raised the top limit of its interest rate corridor to 14.75%, saying the move aimed to make policy more flexible, per Reuters. The lira’s decline, nearly 30% so far this year, has lead to higher inflation via imports priced in hard currencies. The lira TRYTOM=D3 has declined since the beginning of the year on concerns over sticky inflation, negative real rates, the central bank’s forex reserves, Turks’ surging demand for forex, and, more recently, geopolitical tensions. A currency crisis in 2018 that nearly halved the lira’s value at one point sent inflation rocketing to a 15-year high of more than 25%. Turkey’s inflation is expected to tick up slightly in October to stand at 11.90%, near the same level as the previous three months, a Reuters poll showed on Friday, after a weak lira led the central bank to raise its year-end forecast this week. The lira’s decline, nearly 30% so far this year, has lead to higher inflation via imports priced in hard currencies. Prices have also remained elevated due to strong credit growth and rising food prices, leading the central bank to hike its year-end forecast this week to 12.1% from 8.9%.