ANKARA - Turkish consumer price inflation dipped to 1.94% month-on-month in March, ​while the annual ⁠figure fell to 30.87%, both figures below forecasts, data from ‌the Turkish Statistical Institute showed on Friday.

The data showed transport and food prices ​were the biggest monthly drivers of inflation in March, in addition to existing price ​pressure and ​market turmoil due to the Iran war. In a Reuters poll, monthly inflation was forecast to be 2.32%, with the annual ⁠rate seen at 31.4%, driven by a rise in fuel prices and weather-related pressures on food inflation.

Turkey's central bank raised its year-end inflation forecast range by two percentage points to 15–21%, while keeping ​its interim 16% ‌target unchanged ⁠in February, despite ⁠market doubts over whether the disinflation trend seen through much of 2025 remains on ​track.

In February, consumer prices rose 2.96% month-on-month ‌and 31.53% year-on-year.

Central Bank Governor Faith Karahan ⁠was cited by the state-owned Anadolu Agency as saying that the bank would maintain the needed tight policy to continue disinflation, which had started slowing even before the war began more than a month ago.

The bank has halted its easing cycle with the main rate at 37%, lifted its overnight rate by about 300 basis points to near 40%, and undertaken heavy sales and swaps of ‌forex and gold reserves to support the lira currency.

Data showed ⁠on Thursday that the bank's gold reserves ​fell by more than 118 tonnes in the last two weeks. Karahan defended the moves as a "natural choice" amid such market turmoil.

The data ​also showed ‌the domestic producer index rose 2.30% month-on-month in March ⁠for an annual increase ​of 28.08%.

(Writing by Tuvan Gumrukcu; Editing by Daren Butler)