Turkish central bank leaves key interest rate unchanged
The Turkish Central Bank kept the central benchmark interest rate unchanged at its Thursday meeting. It remains at 50 percent, as the Central Bank announced. The Central Bank intends to continue its tight monetary policy until monthly inflation significantly and sustainably decreases.
In May, inflation reached a rate of 75.45 percent. However, observers expect the inflation rate to decline now.
Turkish President Recep Tayyip Erdogan resisted higher interest rates despite rampant inflation for a long time. After his re-election as President last year, he changed the economic leadership and initiated the rate cut. The Central Bank lowered the benchmark interest rates from 8.5 percent in June 2023 to the current 50 percent.
After the Central Bank's decision to maintain the key interest rate at 50%, investors expressed their concerns about Turkey's inflation outlook. The Turkish Central Bank's Thursday session was closely watched by global financial markets due to the country's high inflation rate. Despite the Central Bank's commitment to tight monetary policy, some analysts question whether the Turkish Central Bank's decision to keep the interest rate unchanged will effectively curb inflation.
