Turkish Central Bank Slashes Key Rate By 50 Bps

RTTNews | 650天前
Turkish Central Bank Slashes Key Rate By 50 Bps

(RTTNews) - Turkey's central bank cut its key interest rate by 50 basis points to 8.5 percent on Thursday, in a bid to support the economy that has been devastated by the most severe earthquake in decades. "The Committee assessed that the current monetary policy stance after the measured reduction is adequate to support the necessary recovery in the aftermath of the earthquake by maintaining price stability and financial stability," the Central Bank of the Republic of Turkey, or CBRT, said in a statement.

The bank stressed that it has become even more important to keep financial conditions supportive to preserve the growth momentum in industrial production and the positive trend in employment after the earthquake.

In January, the Monetary Policy Committee, led by Governor Sahap Kavcioglu, had left the rate unchanged at 9.00 percent for a second straight month after inflation slowed notably from near 85 percent to a nine-month low of 64 percent.

The bank has lowered the policy rate by a cumulative 550 basis points since last August.

The earthquake is expected to affect economic activity in the near term, but it is anticipated that it will not have a permanent impact on performance of the Turkish economy in the medium term, the bank said. The bank also pointed out the sustained improvement in the underlying inflation.

Policymakers will prioritize the creation of supportive financial conditions in order to minimize the effects of the disaster and support the necessary recovery, the central bank added.

The effects of the earthquake, especially that of supply-demand imbalances on inflation, in the first half of 2023 will be closely monitored.

The central bank reaffirmed that it will continue to use all available instruments decisively until strong indicators point to a permanent fall in inflation, and the medium-term 5 percent target is achieved in pursuit of the primary objective of price stability.

Capital Economics is looking for another 50 basis points cut in March despite the limited scope the central bank has to ease further given the already-distorted policy settings and the large external risks.

"The relatively small 50bp rate cut highlights the limited policy space the CBRT has available," Capital Economics economist Liam Peach said. "Even so, another rate cut seems likely as President Erdogan applies pressure on the central bank ahead of the election in May."

The election may be pushed back in the backdrop of the earthquake. The prospect of further easing in the policy stance amid high inflation could hurt the lira, which has remained relatively stable in the recent months, the economist noted.

read more
Turkey Maintains Policy Rate At 45% Under New Governor

Turkey Maintains Policy Rate At 45% Under New Governor

The Turkish central bank left its benchmark rate unchanged at the first policy meeting under the governorship of Fatih Karahan after a slew of rate hikes, and signaled that the rate will be maintained at the current level or will be tightened further in case of persistent deterioration in the inflation outlook.
RTTNews | 286天前
Turkish Central Bank Slows Pace Of Tightening

Turkish Central Bank Slows Pace Of Tightening

Turkey's central bank raised its benchmark rate by 250 basis points on Thursday to combat high inflation but the pace of tightening was reduced as policymakers assessed that it is close to the level required to establish the disinflation course. The Monetary Policy Committee of the Central Bank of the Republic of Turkey, or CBRT, governed by Governor Hafize Gaye Erkan, decided to raise the one-w
RTTNews | 349天前
Turkish Central Bank Takes U-Turn By Lifting Key Rate By 650 Bps To 15%

Turkish Central Bank Takes U-Turn By Lifting Key Rate By 650 Bps To 15%

Turkey's central bank raised its key interest rate for the first time in more than two years on Thursday, and massively, in the first meeting chaired by its newly appointed chief with the aim of establishing disinflation immediately and anchoring the inflation target. The Monetary Policy Committee, headed by the new Governor Hafize Gaye Erkan, decided to hike the policy rate by 650 bps to 15%.
RTTNews | 531天前
Turkish Central Bank Keeps Policy Rate Unchanged At 8.50%

Turkish Central Bank Keeps Policy Rate Unchanged At 8.50%

Turkey's central bank maintained its key interest rate for the third straight time at its May meeting on Thursday, and policymakers assessed that the current monetary policy stance is adequate to support the necessary recovery from the outcome of the earthquake by maintaining price stability and financial stability.
RTTNews | 559天前
Turkish Central Bank Keeps Key Rate Unchanged For Second Time

Turkish Central Bank Keeps Key Rate Unchanged For Second Time

Turkey's central bank maintained its key interest rate for the second straight meeting on Thursday ahead of the presidential election on May 14. The Monetary Policy Committee of the Central Bank of the Republic of Turkey, or CBRT, led by Governor Sahap Kavcioglu, left the policy rate, which is the one-week repo auction rate, unchanged at 8.50 percent. The move was in line with expectations.
RTTNews | 587天前
Turkish Central Bank Keeps Key Rate Unchanged At 8.50%

Turkish Central Bank Keeps Key Rate Unchanged At 8.50%

Turkey's central bank decided to maintain its key interest rate in its March meeting, as the committee assessed that the current monetary policy stance is adequate to support the necessary recovery in the aftermath of the earthquake by maintaining price stability and financial stability.
RTTNews | 622天前
Turkish Consumer Price Inflation Slows To 57.68%

Turkish Consumer Price Inflation Slows To 57.68%

Turkey's consumer price inflation eased for a third month in a row in January, but remained strong, preliminary figures from the statistical office Turkstat showed Friday. The consumer price index, or CPI, rose 57.68 percent year-on-year following a 64.27 percent increase in December. Economists had forecast 53.5 percent inflation. In the same month last year, inflation was 14.97 percent.
RTTNews | 670天前