Delivering a speech at a meeting jointly organized by the İstanbul Young Entrepreneurs Association (İSGİD) and Young Businessmen’s Confederation of Turkey (TÜGİK), Yılmaz noted that the Turkish lira had gained value against the US dollar; however, he added this situation mainly stemmed from the appreciation of the euro against the dollar.
Yılmaz stated that since the adoption of an inflation targeting regime, the exchange rate has constantly been on the agenda of industrialists, businessmen and bankers in Turkey, which he said is necessary as the exchange rate is a vital figure.
“No one can ignore changes in exchange rates; however, a wrong perception holds that changes in exchange rates or its adjustments will cure everything. Even though the exchange rate is very important, there are also macro and micro structural problems that persist in the country and they should not be ignored,” he said.
The annual inflation rate is expected to approach the lower limit of the uncertainty range by the end of 2009, Yılmaz stated, adding that fluctuations might be seen in the annual inflation rate in the first half of the coming year due to the base effect, which will make the rise in inflation look higher as the corresponding month of previous year saw a lower inflation rate. However, he added, current indicators show that the rate will remain below the 2010 target of 6.5 percent.
According to data compiled by the Turkish Central Bank, along with figures released by the Turkish Statistics Institute (TurkStat), he said the inflation rate will be about 5.5 or 5.6 percent by year’s end.
Yılmaz, noting that a rise in inflation due to the base effect will continue until April 2010, added that the central bank will not respond to this rise by using monetary instruments.
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