Inflation in Turkey continues to rise. In October, consumer prices rose by 19.9 percent in the whole year compared to the same month last year. Last month inflation was 19.6 percent. The statistics agency reported this on Wednesday.

 

The price increase has been giving investors a headache for a while, which is why they are avoiding the Turkish lira. Turkey’s national currency has come under considerable pressure from the dollar and the euro in recent months and at one point fell to an all-time low.

The situation was exacerbated by the accommodative monetary policy of the central bank, which had recently cut the key interest rate twice, despite rising inflation.

Critics denounce Turkish President Recep Tayyip Erdogan’s decisive influence on the course. Last month, Erdogan had fired two more important top executives of the Turkish central bank. Erdogan had previously replaced top central bank officials.

Erdogan argues that high-interest rates cause high inflation, but that goes against the common economic theory. Normally, an interest rate cut will lead to higher prices.