Treasury and Finance Minister Mehmet Şimşek's statements that high inflation in Turkey was attributed to the escalating geopolitical crisis around Iran, the USA and Israel contradicted the historical flow of official data. Although Şimşek's words, "If there had been no war, inflation would have been at least 7 points lower, we would have closed the year at 21-22 percent" were at the center of the economic management's disinflation narrative, the figures showed that inflation was rapidly increasing months before the impact of the crisis emerged.
PRICES WERE RISING BEFORE THE WAR STARTED
The Turkish economy entered 2026 with strong inflationary pressure, even at a time when the war had not yet been reflected in pricing behavior. According to the data of the Turkish Statistical Institute, monthly inflation reached 4.84 percent and annual inflation reached 30.65 percent in January. The fact that the monthly rate remained at 4.84 percent indicated that the deterioration in price stability was not temporary but structural.
February data made the break in the disinflation target even more visible. Annual inflation started to rise again in February after a 20-month downward trend. According to TÜİK, monthly inflation was 2.96 percent in February, while annual inflation increased to 31.53 percent.
Moreover, TUIK's calculations are based on price data between the 1st and the 24th of the relevant month. The date when the hot conflict started and the barrel price of Brent oil increased by more than 7 percent in one day, reaching 82 dollars, coincides with February 28. This shows that the war-related energy shock was not reflected in February inflation. Despite this, the upward trend in inflation indicated that price pressures were mainly fueled by internal dynamics.
GOALS CHANGED 17 TIMES IN 5 YEARS
Şimşek's assessment that "The perception that the targets are not met is not correct" does not coincide with the economic management performance of the last five years. Since 2021, the Central Bank of the Republic of Türkiye and the economic management have revised their inflation targets upwards a total of 17 times.
The change in the targets for 2026 clearly reveals this picture. The year-end inflation target, which was initially announced as 8.5 percent, was first increased to 16 percent, then to 26 percent and 28 percent. In the current Medium Term Program announced in September, this rate was determined as 28.4 percent.
Attributing this sharp deviation from the single-digit initial target to 28.4 percent to external shocks and war effects also covers up the inconsistencies in economic policy.
WHILE CITIZENS GET POOR, CAPITAL TURNS OUTSIDE
Target revisions of economic management and macroeconomic imbalances deepen the loss of purchasing power in large segments of society. The purchasing power of the net minimum wage, which was announced as 28 thousand 75 TL on December 23, 2025, quickly eroded against the cumulative inflation of 10.05 percent in the first quarter of the year. Similarly, the lowest pension, which was increased to 20 thousand TL, actually decreased to 18 thousand 173 TL.
Surveys of the Central Bank of the Republic of Turkey also confirm the loss of confidence. According to the Household Expectations Survey, citizens' annual inflation expectation for the next 12 months is at 46.13 percent. The real sector's expectation is 33.10 percent. This table points to a pricing behavior that is shaped not by official targets, but by the directly felt cost of living.
This internal distrust causes large capital groups to turn their attention abroad. The fact that direct investments from Turkey abroad in the first 10 months of 2026 will reach 5.4 billion dollars and that some large holdings will sell their domestic assets and turn to new European-based structures stand out as one of the clearest indicators of the erosion of confidence in the economy.
In conclusion, although it is accepted that the war had a cost on the economy, current data reveal that inflation in Turkey cannot be explained only by an external shock. Figures show that price increases started much earlier and the fire of inflation grew due to structural problems within the country.
7 POINT INFLATION DIFFERENCE
Especially the statements that inflation is at least 7 points higher due to the war are difficult to make sense of when compared to the inflation rates of the parties to the wars in West Asia and the north.
In the light of the latest data, the inflation rates of the countries that are at the center of conflicts and greatly affect the world economy are as follows:
