What's going on?

Data out on Thursday showed that Turkey�s inflation hit a 24-year high last month, which will hardly vindicate the country�s unconventional approach.

What does this mean?

Looks like Turkey skipped Econ 101: the country�s government still believes that cutting interest rates will help bring inflation down, despite the rest of the world ��and the world�s textbooks ��proclaiming the opposite. But Turkey�s central bank has cut rates by a chunky 3.5% over the last three months alone, and it�s yet to prove traditionalists wrong. In fact, the prices of food and non-alcoholic drinks ��which make up a quarter of the country�s total inflation ��essentially doubled last month from the same time last year, while transport costs puffed up nearly 120%. And sure, overall inflation came in lower than economists expected, but that�s hardly a victory when it�s 85.5% � seventeen times the central bank�s target and the seventeenth monthly spike in a row.

Why should I care?

For markets: Bigger things are coming.
Turkey�s inflation makes rising western prices rises look positively puny, and it’s only outpaced by the likes of Zimbabwe, Venezuela, Syria, Lebanon, and Sudan. And while Turkey�s knee-shaking increases should slim down as numbers start to be compared to the sharp price rises of late last year, things will still probably get worse. See, the government�s hoping to entice voters with a higher minimum wage and cheaper loans ahead of next year�s elections, which ��along with continued rate cuts � will only weaken the lira more and fire up inflation further.

Zooming out: Let�s get conventional.
The UK�s gone the textbook route, announcing a 0.75-percentage-point interest rate hike on Thursday ��its biggest in 33 years. And while the central bank stressed that rates will peak lower than markets expect, that doesn�t mean the UK isn�t up against it. In fact, its forecast suggests the UK�s already in a recession, and that the economy will shrink for eight-straight quarters ��until the middle of 2024.