The Central Bank of the Republic of Türkiye (CBRT) has published its Sectoral Inflation Expectations report for August 2025, showing a notable decline in annual inflation expectations across key sectors.

The report indicates growing optimism among market participants, the real sector, and households, signaling increased confidence in Türkiye’s economic stabilization efforts.

According to the CBRT, 12-month-ahead annual inflation expectations fell in August 2025. Market participants’ expectations dropped by 0.6 points to 22.8%, while the real sector recorded a larger decrease of 1.3 points to 37.7%. Household inflation expectations also eased slightly, declining by 0.4 points to 54.1%.

In a further positive development, the share of households expecting inflation to decrease over the next 12 months rose by 1 point from the previous month, reaching 27.6%. Analysts suggest that this increase reflects growing public confidence in the CBRT’s monetary policies aimed at curbing inflation and promoting economic stability.

The decline in inflation expectations across all sectors underscores the potential effectiveness of Türkiye’s recent monetary and fiscal measures, as the country continues to navigate global and domestic economic challenges.

The CBRT’s report provides a cautiously optimistic outlook, with stakeholders increasingly anticipating a downward trend in inflation in the months ahead. (ILKHA)