The Central Bank of the Republic of Turkey announced the first interest rate decision of the year today. The announced decision was a decision that met market expectations.
The Central Bank of the Republic of Turkey (CBRT) made the expected statement after the Central Bank Monetary Policy Committee (PPK) meeting, which came together today under the chairmanship of President Şahap Kavcıoğlu. After the meeting, the Central Bank First interest rate decision of 2022 announced. The decision came in line with expectations.
The Central Bank of the Republic of Turkey cut the interest rate by 100 basis points to 14% on December 16, 2021. The depreciation of the Turkish lira in December and the previous months, after the dollar broke a record with 18 and stabilized at 13.40 today, was withdrawn from the CBRT. A new rate cut decision was not expected..
Rate held steady at 14%:
The Central Bank announced that the interest rate It was decided to keep it constant at 14%. announced. In the shared statement, the reason for keeping the policy rate constant at 14% was also shared. The statement on inflation was as follows:
“In the recent rise in inflation; Supply-side factors such as pricing behaviors indexed to exchange rates due to unhealthy price formations in the foreign exchange market, increases in global food and agricultural commodity prices, and disruptions in supply processes and demand developments are influential. With the steps taken to establish sustainable price stability and financial stability, the Board decided that the base effects on inflation would disappear. that the disinflationary process will begin foresees.
In this context, the Board decided to keep the policy rate constant.. The cumulative effects of the decisions taken are closely monitored, and a comprehensive policy framework review process, which prioritizes the Turkish lira in all policy instruments of the CBRT, is carried out in order to reshape price stability on a sustainable basis in this period.
CBRT, in line with the main objective of price stability, until strong indicators pointing to a permanent decrease in inflation and until the medium-term 5% target is reached. will continue to use all the tools at its disposal with determination. The stability to be achieved in the general level of prices will positively affect macroeconomic stability and financial stability through the decrease in country risk premiums, the continuation of reverse currency substitution and the upward trend in foreign exchange reserves, and the permanent decline in financing costs. Thus, a suitable ground will be created for the continuation of investment, production and employment growth in a healthy and sustainable way.
President Erdoğan gave the news of interest rate cuts in the upcoming period:
Speaking after his visit to Albania, President Recep Tayyip Erdoğan said:At one point, you know, it came to 12 or even lower. Then there was another exit. But we’re going to pull that down as well. This will be shaped by the conditions in the economy. Gradually, gradually, without haste, the exchange rate will also fall, and the interest will likewise fall.” he had used.