Turkish Central Bank Keeps Rates on Hold as Inflation Remains High
By Xavier Fontdegloria
Turkey's central bank on Thursday kept its key policy rate
unchanged after lowering it in February amid evidence of persisting
The central bank kept its policy rate stable at 8.5% after
cutting it by 50 basis points in February in order to support
economic activity in the aftermath of the earthquakes that hit the
south of the country.
Economists expected the central bank to cut rates by 25 basis
points to 8.25%, according to a consensus forecast provided by
Policy makers assessed that the current monetary policy stance
is adequate to support the necessary recovery after the earthquake
by maintaining price stability and financial stability, the central
Inflation in Turkey eased to 55.2% in February, but remained at
high levels with signs that the cooling trend seen in the last few
months is moderating.
"February's inflation data showed that underlying core price
pressures are extremely strong, suggesting there is no room for
further rate cuts," Capital Economics emerging Europe economist
Nicholas Farr said in a note ahead of the central bank's
Still, the central bank said it will prioritize the creation of
supportive financial conditions in order to minimize the effects of
the earthquake and support the recovery.
"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," it said.
Write to Xavier Fontdegloria at firstname.lastname@example.org
(END) Dow Jones Newswires
March 23, 2023 07:25 ET (11:25 GMT)
Copyright (c) 2023 Dow Jones & Company, Inc.