Türkiye's annual inflation accelerated to 64.77% in December, in line with the central bank's year-end expectation range and below market forecast, official data by the country's statistical authority showed Wednesday.

The month-over-month rise in consumer prices stood at 2.93%, the Turkish Statistical Institute (TurkStat) said, dipping from a 3.28% increase in November.

The measure has eased in recent months as sharp monetary tightening has begun to weigh, with monthly consumer price index (CPI) easing for the fifth consecutive month.

The Central Bank of the Republic of Türkiye (CBRT) quintupled its benchmark policy rate following the May elections. It shifted in policymaking, bringing its one-week repo rate to 42.5% from 8.5% to tame inflation and cool demand.

The bank, however, decided to downshift tightening with 250 basis points in its last committee meeting last month and said "it will complete the tightening cycle as soon as possible."

A Reuters poll showed that annual inflation was expected to rise to 65.1% in December, with monthly inflation at 3.1%. In November, annual inflation was 61.98%.

An Anadolu Agency (AA) survey had estimated that consumer prices would rise 65.19% year-over-year and 3.19% month-over-month.

Türkiye's central bank and the government's medium-term program (MTP) forecasted year-end inflation for 2023 at 65%.

"The 2023 year-end realizations align with our program and we are meeting our revised targets. With the continuing decline in monthly inflation, year-end inflation was 64.8%," said Treasury and Finance Minister Mehmet Şimşek.

"Annualized core indicators continue to be consistent with our 2024 target," Şimşek wrote on social media platform X, formerly Twitter.

"We predict that growth and current account deficit will be compatible with our targets," he noted.

Price rises in hotels, cafes and restaurants drove the annual price surge with a 93.24% hike, while housing posted the lowest increase with 40.39%, the data from TurkStat showed.

Food and nonalcoholic drinks inflation advanced 72.01% annually in December, as per data.

Inflation is expected to continue rising and peak in May between 70% and 75% before entering a disinflation trend.

"The underlying inflation trend improved slightly, and inflation expectations stabilized in the last months," said Bartosz Sawicki, a market analyst at the Conotoxia investment house.

Liam Peach of Capital Economics said the latest figure "will generally comfort the central bank."