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Turkey's annual inflation jumped far more than expected to 36.08% year-on-year in December, the highest since September 2002, data showed on Monday reflecting a plummet in value of the lira late last year.

Month-on-month, consumer prices rose 13.58%, the Turkish Statistical Institute said, compared to a Reuters poll forecast of 9%. The annual inflation forecast was 30.6%, Reuters reported.

The lira was trading at 13.6 against the dollar after the data, 3% weaker on the day but off an early low of 13.92. It shed 44% of its value last year after a volatile November and December.

The producer price index rose 19.08% month-on-month in December for an annual rise of 79.89%, the data showed, reflecting soaring in import prices due to the currency crash.

It was the highest CPI annual since the 37.0% of September 2002, before President Tayyip Erdogan's AK Party first came to power in November of that year. The forecasts of 13 economists ranged between 26.4% and 37.3%.

Consumer prices were led higher by transport prices, which soared 53.66% year-on-year, while heavily weighted food and drinks prices jumped 43.8%.

"This reflects a vicious cycle of demand-pull inflation, which is very dangerous because the central bank had implied the price pressure was from supply constraints, and that it couldn't do anything about it," said Ozlem Derici Sengul, founding partner at Spinn Consulting, in Istanbul.

"Rates should be immediately and aggressively hiked," she said. "Annual inflation will probably reach 40-50% by March."