Central Banks
Shock Rate Cuts Nearing End in Turkey After Biggest Move Yet
- Monetary Policy Committee lowers rates for third straight time
- Inflation is almost 17 times higher than the bank’s 5% target
The Mahmutpasha Bazaar in the Fatih district of Istanbul.
Photographer: Erhan Demirtas/BloombergThis article is for subscribers only.
Turkey’s central bank lowered its benchmark interest rate for the third time in a row and by a bigger magnitude than forecast, signaling it’s close to ending a series of cuts that have pushed an ultra-loose monetary policy to new extremes.
Led by Governor Sahap Kavcioglu, the Monetary Policy Committee reduced its one-week repo rate to 10.5% from 12% on Thursday, despite annual inflation rocketing past 83%. The MPC said it will consider “taking a similar step at the following meeting and ending the rate-cut cycle,” according to a statement accompanying its decision.