High inflation is an important concern of markets and policy makers Therefore lowering inflation and keeping inflation low is an important policy task A change in exchange rate may have an effect on domestic inflation Previous studies have shown that the pass through effect in Turkey is fast But there is not a unanimous agreement about the magnitude Previous studies about Turkey have used aggregate price indices which may cause some bias Using monthly and sectoral data this study shows that pass through in Turkey is fast and quit low Furthermore the reactions of different sectors are not homogeneous Pass through is especially low in non traded sectors such as agriculture food and drinks and housing Also there is a weak evidence showing that high exchange rate volatility is associated with higher inflation Key Words: Exchange rate inflation pass through sectors
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