Big discounts at a store on Istanbul’s famous Istiklal Street. September inflation data showed consumer prices climbed 6.3 per cent for an annual rise of 24.52 per cent, outpacing expectations. Image Credit: Reuters

Istanbul: Turkey’s private sector has agreed to an across-the-board price cut of at least 10 per cent for goods, Finance Minister Berat Albayrak said on Tuesday, a move aimed at taming inflation that surged to nearly 25 per cent last month.

Speaking at an event to announce his programme to fight inflation, Albayrak, President Tayyip Erdogan’s son-in-law, said ensuring price stability cannot be conducted by the government alone and all economic actors need to support it. Inflation surged to a 15-year high of nearly 25 per cent in September.

“The fight against inflation and for price stability is not a fight that can be conducted by the state and institutions alone,” Albayrak said, adding that prices would be lowered by a minimum 10 per cent until the end of the year.

He said the discount would be reflected in all the goods that make up Turkey’s inflation basket, and that there would not be any more price increases in electricity and natural gas until year-end.

September inflation data, which showed consumer prices climbed 6.3 per cent during the month for an annual rise of 24.52 per cent, far outpaced expectations and illustrated the impact of a currency crisis on the economy and consumers.

The lira has lost 38 per cent of its value against the dollar this year on concerns about President Recep Tayyip Erdogan’s influence over the central bank and a diplomatic spat with Washington. It eased slightly to 6.15 as Albayrak spoke.

Investors are now weighing up prospects for the central bank to raise interest rates at its next policy-setting meeting on October 25. At its meeting last month it hiked its benchmark rate by a massive 6.25 percentage points, supporting the lira.

Producer prices — a leading indicator of price change in the economy — soared more than 46 per cent in September from a year earlier.