Fueled by recent tax hikes, the consumer price index (CPI) increased by 1.45 percent in February over the preceding month, putting annual inflation at 10.13 percent, data released by the Turkish Statistics Institute (TurkStat) on Wednesday have shown.

The central bank last month warned that the government's price and tax adjustments in December 2009 would drive inflation figures higher in February. Shaped by the aftereffects of tax hikes, the annual inflation rate had increased by a significant 1.66 percentage points in January to reach 8.19 percent. The latest indices showed that inflation growth slightly surpassed the central bank's predictions.The bank had earlier predicted that tax measures on fuel, alcohol and tobacco products would add 1.5 points to inflation in 2010, with a total inflation rate of between 5.5 and 8.3 percent in 2010.The greatest annual increase in the CPI was experienced in alcoholic beverages and tobacco, food and non-alcoholic beverages and transportation, with a 52.8 percent, 14.84 percent and 9.68 percent annual increase in prices, respectively. When looking at the monthly changes, the price of food and non-alcoholic beverages rose by 5.01 percent, while alcoholic beverages and tobacco and transportation prices saw relatively smaller increases of 3.72 percent and 0.4 percent, respectively, in February over the preceding month.Fueled by recent tax hikes, the consumer price index (CPI) increased by 1.45 percent in February over the preceding month, putting annual inflation at 10.13 percent, data released by the Turkish Statistics Institute on Wednesday have shown. The central bank last month warned that the hikes would drive inflation figures higher in February The largest non-food item monthly price change was in ready-wear, 5.25 percent lower than the previous month. The highest increases in CPI were recorded in the provinces of Şanlıurfa and Diyarbakır, registering a 13.16 percent increase. In February 2010, the index took into consideration the average price of 446 items; of these the average price of 66 items remained unchanged, while the average price of 230 items increased and that of 150 items decreased.The TurkStat data revealed that the PPI figures -- which measure the changes in prices received by domestic producers for their output -- increased on a monthly basis by 1.66 percent compared to the previous month. The largest annual increase in prices was experienced by the agriculture sector, with a 19.73 percent annual rise in producers' prices. The monthly price increase in agriculture was realized as 4.16 percent.Producer prices increased by 9.14 percent in the utilities index over the previous month, the highest monthly change. The manufacturing industry index saw a minor 0.39 percent increase in prices in February over January, while the index for mining and stone quarrying saw an even lower increase of 0.28 percent in the same period.The subsector that saw the largest monthly increases in producer prices received was the electricity and gas subsector, with a 10.27 percent monthly increase in February. Manufacturing in the office electronics subsector saw the second-biggest hike in prices, with a 1.98 percent increase over January. In February 2010, within the average prices of 779 items in the index, the average price of 151 items remained unchanged, while the average price of 381 items increased and that of 247 items decreased.Evaluating the inflation figures to reporters on Wednesday in Ankara, Finance Minister Mehmet Şimşek said it was unsettling that the figures have reached double digits, adding, however, that this did not come as a surprise for the markets. “We had been predicting that inflation would increase following the recent tax hikes. I hope the central bank targets for inflation will be achieved by the end of the year,” he said, citing “temporary” price increases as the major factor behind the current volatile atmosphere. 04 March 2010, ThursdayTODAY'S ZAMAN  İSTANBUL