Methodology Criticism of ITO Inflation Calculation by Economy Writer

Economy writer Alaattin Aktaş claimed that the Istanbul Chamber of Commerce made a methodological error by taking end-of-month prices instead of monthly averages in its inflation calculations, rendering the announced rates meaningless.

Background of the Methodology Debate

In his column, economy writer Alaattin Aktaş criticized the Istanbul Chamber of Commerce's inflation calculation method, stating that the applied methodology is incompatible with the logic of inflation calculation.

In the article, it was claimed that ITO bases its inflation determination directly on end-of-month prices instead of the monthly average, which was argued to undermine data reliability.

Data Analysis via Diesel Prices

Stating that the methodological error can be clearly seen through fluctuations in diesel prices, Aktaş reported that according to ITO data, diesel prices declined by 4.3 percent in August.

However, it was emphasized that this rate only covers the final days of July and August, whereas when monthly averages are taken as a basis, diesel prices increased by 11.7 percent compared to July.

Claim That Announced Rates Became Meaningless

Stating that August inflation was prepared by taking these price changes into account, the author expressed that creating an index based on a price drop rather than the actual increase rate in a high-weight product like diesel makes the calculations questionable.

Following this situation, it was stated that the 1.66 percent monthly inflation rate shared with the public by ITO for August has become completely meaningless.

ITO's August Inflation Data

In the announcement made by the Istanbul Chamber of Commerce on September 1, it was announced that retail prices across Istanbul decreased by 1.66 percent in August compared to the previous month.

In the same statement, it was announced to the public that the annual increase rate in retail prices stood at 34.96 percent.