“The worst is over” for Turkey’s inflation: Turkey’s annual consumer price inflation rose to 75.5% in May — according to the Turkish Statistical Institute — in what economists expect to be the peak of a years-long cost-of-living crisis before prices start to cool. “The worst is over,” Finance Minister Mehmet Simsek said on X. “The transition period in the fight against inflation is complete and we are entering the disinflation process,” he added.

In detail: Headline inflation in May — which was up by 5.7 percentage points from a monthearlier — was driven primarily by steep annual price rises in education, housing, and restaurants. Monthly inflation climbed to 3.4% in May, up from 3.2% in April.

Despite the jubilant tone, inflation still came in higher than expected: A Reuters poll saw annual inflation peaking at 74.8% in May and monthly inflation registering 2.7-3.3%.

So where is inflation headed from here? Annual inflation will likely drop below 50% by the end of 3Q 2024, hit 33.2% in 12 months, and 21.3% in 24 months, Simsek said. Analysts polled by Reuters expect annual inflation to drop to 42.6% by the end of 2024.

MARKETS THIS MORNING-

Most Asian markets have started the day in the red, with only Hong Kong’s Hang Seng bucking the trend. There’s no clear trigger for the dip, which sees the Nikkei leading decliners at dispatch time this morning (-0.7%). Futures for major European benchmarks dipped overnight, while Nasdaq, Dow, and S&P 500 futures were largely unchanged.

EGX30

26,834

-0.1% (YTD: +7.8%)

USD (CBE)

Buy 47.07

Sell 47.21

USD (CIB)

Buy 47.1

Sell 47.2

Interest rates (CBE)

27.25% deposit

28.25% lending

Tadawul

11,808

+1.6% (YTD: -1.3%)

ADX

8,918

+0.6% (YTD: -6.9%)

DFM

3,993

+0.4% (YTD: -1.6%)

S&P 500

5,283

+0.1% (YTD: +10.8%)

FTSE 100

8,263

-0.2% (YTD: +6.9%)

Euro Stoxx 50

5,004

+0.4% (YTD: +10.7%)

Brent crude

USD 78.36

-3.4%

Natural gas (Nymex)

USD 2.77

+0.4%

Gold

USD 2,371

+0.1%

BTC

USD 69,090

+1.9% (YTD: +63.0%)

THE CLOSING BELL-

The EGX30 fell 0.1% at yesterday’s close on turnover of EGP 3.2 bn (34.1% below the 90-day average). Local investors were net buyers. The index is up 7.8% YTD.

In the green: Qalaa Holdings (+10.7%), Ibn Sina Pharma (+5.8%), and Orascom Development Egypt (+5.4%).

In the red: Mopco (-3.5%), AMOC (-2.8%), and Beltone Holding (-2.7%).

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