Turkey’s annual inflation rate held steady near 60 per cent last month, official data showed Thursday, offering the first evidence that President Recep Tayyip Erdogan’s economic policy U-turn was working.

The TUIK state statistics agency said consumer prices rose 61.5 per cent over the 12-month period ending in September.

The annual rate stood at 58.9 per cent in August and 47.8 per cent in July.

The month-on-month increase in prices also slowed, to 4.8 percent in September from 9.1 percent in August and 9.5 percent in July.

The data suggest that Turkey’s inflation rate is starting to peak after Erdogan signed off on a series of sharp interest rate hikes that have taken the policy rate to 30 per cent from 8.5 per cent in four months.

“The small (by Turkey’s recent standards) rise in inflation to 61.5 per cent last month, from 58.9 per cent in August, provides the first signs that the inflation spike is close to levelling off,” Capital Economics analyst William Jackson said.

Erdogan had been a lifelong supporter of the unorthodox economic theory that high-interest rates cause — rather than cure — inflation.