The Big Mac index: Turkey

Macro

2026-09-01

Description

The big mac index was invented by The Economist in 1986 as a lighthearted guide to whether currencies are at their “correct” level. It is based on the theory of purchasing-power parity (PPP), the notion that in the long run exchange rates should move towards the rate that would equalise the prices of an identical basket of goods and services (in this case, a burger) in any two countries.

Published by
The Economist
Frequency
Aperiodically
Next Update
Hashtags
Big Mac index PPP

AI Data Insight

In the first quarter of 2026, Turkey's Big Mac Index climbed to $5.9058, significantly higher than the $5.5953 recorded in the third quarter of 2025, setting a new historical record. This reflects that the surge in Turkey's domestic prices has completely overshadowed the effects of the lira's depreciation, leading to a massive increase in USD-denominated living costs. Against the backdrop of the central bank maintaining high interest rates to combat inflation, Turkey's real exchange rate is likely to continue facing overvaluation pressure in the short term.

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AI Data Insight

In the first quarter of 2026, Turkey's Big Mac Index climbed to $5.9058, significantly higher than the $5.5953 recorded in the third quarter of 2025, setting a new historical record. This reflects that the surge in Turkey's domestic prices has completely overshadowed the effects of the lira's depreciation, leading to a massive increase in USD-denominated living costs. Against the backdrop of the central bank maintaining high interest rates to combat inflation, Turkey's real exchange rate is likely to continue facing overvaluation pressure in the short term.

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Description

The big mac index was invented by The Economist in 1986 as a lighthearted guide to whether currencies are at their “correct” level. It is based on the theory of purchasing-power parity (PPP), the notion that in the long run exchange rates should move towards the rate that would equalise the prices of an identical basket of goods and services (in this case, a burger) in any two countries.

Published by
The Economist
Frequency
Aperiodically
Next Update
Hashtags
Big Mac index PPP