The Turkish Central Bank on Feb. 4 announced its decision to form a division in charge of analyzing developments in the food and agricultural product markets.
This division will “perform an early warning function by carrying out a detailed and timely analysis of data regarding the prices of food and agricultural products that are critical to price stability,” the bank said.
Food prices rose another 2.5 percent last month and more than 18 percent in a year, the Turkish Statistical Institute (TÜİK) revealed on Feb. 3.
Turkish inflation has been stuck in double digits for most of the last three years, well above the medium-term target of 5 percent.
On Jan. 28, the Food and Agricultural Product Markets Monitoring and Evaluation Committee, including finance, agriculture and trade ministers as well as Central Bank governor Naci Ağbal, convened to take measures to stem the rapid rise of food prices.
The new division will also fulfill secretarial duties for the committee, said the Central Bank.
Cumulative exchange rate effects also played a role in soaring food prices, the bank said in an open letter to the cabinet on Feb. 2.
It underlined that the Turkish Lira depreciated by 25 percent against a currency basket last year.
After touching an all-time low of 8.58 against the U.S. dollar on Nov. 6, 2020, the lira has recovered to below 7.06 since then, as the Central Bank lifted its key interest rate to 17 percent and pledges for market-friendly reforms helped attracted nearly $15 billion to the Turkish assets.