Macroeconomic determinants of food inflation in Türkiye: Empirical evidence from RALS-based time series analysis

This study aims to analyse the macroeconomic determinants of food price inflation in Türkiye using monthly data for the period 2015:01–2025:03. Fluctuations in food prices have significant impacts, particularly on the quality of life and food security of low-income households. In this context, food price inflation is used as the dependent variable. In contrast, the agricultural input price index, commercial loan interest rate, exchange rate, and oil prices are employed as explanatory variables. The stationarity properties of the series are examined through the Zivot-Andrews test and the RALS-LM test with structural breaks. The presence of a long-run cointegration relationship among the variables is tested using the RALS-EG test, and long-run coefficients are obtained via the DOLS method, which addresses endogeneity and serial correlation by augmenting the levels equation with leads and lags of first differences. Empirical findings suggest that agricultural input prices, interest rates, and exchange rates have a positive and significant impact on food inflation. Based on the results, reducing agricultural production costs, expanding the availability of low-interest farm loans, and effectively managing energy subsidies are critical to controlling food inflation.