Turkish President Recep Tayyip Erdogan said on Tuesday that inflation was not an “insurmountable economic threat,” adding that it would start to ease later in the year after skyrocketing to more than 80% in August, the economist said.

As part of Mr. Erdogan’s economic plan, Turkey gradually cut interest rates by 500 basis points late last year, triggering a currency crisis. That cut them another 100 basis points to 13% in August.

The sharp fall of the pound, by 44% last year and another 27% this year, has led to a sharp rise in prices and, along with rising global energy and commodity prices, has pushed inflation to a 24-year high.

“Inflation is not an insurmountable economic threat. I am an economist,” said Erdogan, who is not actually an economist by training.

Speaking on PBS television, Mr. Erdogan said that inflation would come down after the end of the year. That sentiment is shared by economists, who say the annualized rate will decline from December given the surge in prices compared to the same period last year, while on a monthly basis, prices will continue to rise.

Mr. Erdogan added that some countries are threatened with inflation at the level of 8-9%, and in Turkey – about 80%.

“In the markets of my country, the shelves are not empty. But the shelves are empty even in the US, empty in France, empty in Germany. My citizens can find any product they want in the market,” he said, according to an interview transcript released by the Turkish president.

Turkey says it seeks to bring down inflation by first turning its chronic current account deficit into a surplus.

Rising global commodity and energy prices and a possible slowdown in exports in the second half of the year have made this goal almost unattainable this year. Ankara does not see a surplus in the next three years.

Source: Reuters.