[Turkey] Inflation erodes minimum wage increase

According to a report by one of Turkey’s biggest labour organisations, accelerating inflation has pushed the country’s poverty threshold to four times the minimum wage, Yahoo Finance reports.

Food inflation surged 7 per cent in July from just a month earlier, taking the poverty threshold for a four-member family to 22,280 liras ($1,243) per month, the Turk-Is labour confederation said on July 30. The figure is around four times the monthly minimum wage, which was raised by 30 per cent to 5,500 liras at the start of July.

Turk-Is defines the poverty threshold as the total of spending for items including food, clothing, housing, transportation, education and health care. Its “hunger threshold” gauge - measuring monthly food spending - rose to 6,840 liras, 24 per cent higher than the minimum wage.

Turkey’s central bank kept the benchmark rate unchanged at 14 per cent for a seventh month in July. Inflation for July will surge to 80.1 per cent, from 78.6 per cent in June, according to the median estimate of 17 analysts in a Bloomberg survey. The statistics office will publish the data for this month on August 3.

The central bank reportedly expects inflation to end the year at 60.4 per cent; about 12 times the official target of 5 per cent. The bank sees inflation slowing to 19.2 per cent by the end of 2023 and to 8.8 per cent in 2024.

According to a report by one of Turkey’s biggest labour organisations, accelerating inflation has pushed the country’s poverty threshold to four times the minimum wage, Yahoo Finance reports.

Food inflation surged 7 per cent in July from just a month earlier, taking the poverty threshold for a four-member family to 22,280 liras ($1,243) per month, the Turk-Is labour confederation said on July 30. The figure is around four times the monthly minimum wage, which was raised by 30 per cent to 5,500 liras at the start of July.

Turk-Is defines the poverty threshold as the total of spending for items including food, clothing, housing, transportation, education and health care. Its “hunger threshold” gauge - measuring monthly food spending - rose to 6,840 liras, 24 per cent higher than the minimum wage.

Turkey’s central bank kept the benchmark rate unchanged at 14 per cent for a seventh month in July. Inflation for July will surge to 80.1 per cent, from 78.6 per cent in June, according to the median estimate of 17 analysts in a Bloomberg survey. The statistics office will publish the data for this month on August 3.

The central bank reportedly expects inflation to end the year at 60.4 per cent; about 12 times the official target of 5 per cent. The bank sees inflation slowing to 19.2 per cent by the end of 2023 and to 8.8 per cent in 2024.