Update: Turkey Inflatıon Expected To Meet Targets In 2011
Inflation in Turkey is expected to fall in line with the country's target in the first months of 2011, the central bank said Wednesday.
The central bank's quarterly inflation report released last month showed that the bank expects annual inflation in 2011 to be between 3.6%7.2%, with a 70% probability of achieving that rangea mid-point of 5.4%. The bank forecasts annual inflation will fall to 5% in 2012.
Turkey targets a 6.5% inflation rate this year.
According to the latest data, the Turkish consumer price index rose at a lower-than-expected rate of 0.6% on the month in April, while in annual terms, consumer prices rose 10.19%.
In its 10th financial stability report, the central bank said although the latest industrial productioncapacity utilization figures showed double-digit growth in the first quarter of 2010, the country's economic activity will remain below the levels seen before the global financial crisis until the third quarter of the year.
According to the most recent data, Turkish industrial production grew in line with expectations in March, rising 21.1% in annual terms.
Data from the country's central bank Monday showed manufacturing capacity utilization rose to 73.4% in May from 72.2% in April64.2% in May 2009.
Gross domestic product rose 6% on the year in the fourth quarter, after a 2.9% contraction in the third quarter, the most recent figures show.
The economy minister, Ali Babacan, said last month the government was likely to revise its forecast for 2010 economic growth higher in June, from the current prediction of a 3.5% expansion.
In its financial stability report, the central bank also said the Turkish banking sector maintained its strong capital structure during the global financial crisis periodit didn't need any government aid.
Turkish banks have a higher quality capital-adequacy ratio compared with those in other nations, the bank said.
The central bank added that improved asset quality in the country's banking sector will continue to affect profits positively in 2010.
According to the latest data, the overall net profit of Turkey's banks rose 21.6% on the year to 6.28 billion Turkish lira ($3.96 billion) in March, while the sector's capital adequacy ratio rose to 19.9% from 18.5% in March 2009.
(YC-YC-E-ENG)