At its 20 November meeting, the Central Bank of the Republic of Turkey (CBRT) left the one-week policy rate unchanged at 5.75%. The Bank also held the overnight borrowing rate steady at 5.00%, but lowered the overnight lending rate by 50 basis points to 9.00% (8.50% for primary dealers), thus narrowing the interest rate corridor that defines the Bank's monetary policy for a third consecutive month. The decision was broadly expected by the market. The Bank reiterated that the rebalancing process between external and domestic demand continues, with domestic demand rising at a moderate pace and exports expanding despite the weakening global outlook. Against this backdrop, the CBRT explained that "aggregate demand conditions support disinflation and the current account deficit continues to decline gradually". Regarding price developments, the Central Bank expects year-end inflation to be lower than previously forecasted owing to a more favourable evolution in unprocessed food prices. Monetary authorities, however, warned that they will continue to monitor the effect of the recent hike in administered and energy prices on the medium term inflation outlook. The Bank maintained a highly dovish stance, stating that "if deemed necessary for financial stability, a measured cut may be considered in the policy rate and the overnight borrowing rate in the forthcoming period".
Turkey Monetary Policy
Central Bank cuts lending rate for third consecutive month
November 20, 2012
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Turkey Monetary Policy Chart
Note: 1-week repo rate in %, from 25 May 2010 onwards. From January 2008 until 25 May 2010, data refer to overnight borrowing rate.
Source: Central Bank of the Republic of Turkey (CBRT).
Turkey Economic News
October 21, 2016
The consumer confidence index, published by the Statistical Institute in cooperation with the Central Bank, decreased slightly from 74.3 in September to 74.0 in October.
October 20, 2016
At its 20 October monetary policy meeting, the Central Bank of the Republic of Turkey (CBRT) decided to keep the marginal funding rate unchanged at 8.25%.
October 13, 2016
The current account balance recorded a USD 1.8 billion deficit in August (July: USD 2.7 billion deficit).
October 10, 2016
In August, industrial production expanded a calendar-adjusted 2.2% compared to the same month last year.
October 3, 2016
The Manufacturing Purchasing Managers’ Index (PMI), produced by the Istanbul Chamber of Industry (ICI) and IHS Markit, increased slightly to 48.3 in September from August’s 47.0, which had marked a multi-year low.