Turkey’s soaring inflation, fueled by big price hikes at the turn of the year, is dealing harsh blows not only to low-income groups but also the middle class, as  consumer demand has contracted in recent days.

Inflation in 2022 is widely expected to shoot above last year’s 36 percent, which was the highest rate under the 19-year rule of President Recep Tayyip Erdogan’s Justice and Development Party (AKP). Turkish consumers ushered into the new year amid a flurry of fresh price increases on commodities and services such as electricity, natural gas and transport. As a result, monthly inflation is likely to hit about 15 percent in January, exceeding the 13.5 percent rate in December. Double-digit rates are expected also in February and March. 

Turkey’s army of jobless, including 3.8 million who continue to look for work and more than 4 million who have given up, are first in line for the impact. The minimum wage was raised by 50 percent to 4,250 Turkish liras ($307) last month, raising hopes of a relative shield against inflation for the half of the workforce that makes the minimum. Yet the pay hike will probably lose relevance by the end of March, leaving them with a real income erosion again.

Employees earning more than the minimum wage and self-employed small entrepreneurs in rural and urban areas — that is, generally the middle class — are not immune either. Their living standards are changing abruptly, with surging prices forcing reviews of consumption patterns.