Turkey’s central bank keeps its rates at 9%

Turkey’s central bank held interest rates steady at 9% yesterday despite rising inflation, making good on a promise to end a short but sharp easing cycle after President Tayyip Erdogan had called for interest rates. a single digit.

The bank, considered by analysts as a response to Erdogan’s will, repeated that inflation close to 85% should give way to a disinflation process. He gave no hint as to how long he would keep rates stable before elections in the coming months.

“Taking into account the increasing risks in relation to global demand, the Committee assessed that the current official interest rate is appropriate,” the bank’s Policy Committee stated, adding that financial conditions should continue to support the supply and increase in prices. the investment.

After the political decision, the lira approached the historical minimum of 18.6850 against the dollar touched in the previous session.

All the economists polled by Reuters had predicted that the central bank would keep its interest rate unchanged. In the past four months, the CBRT has cut the rate by 500 basis points, citing an economic slowdown, despite global counterparts acting to the contrary.

Inflation, for its part, stood at 84.4% in November, after reaching a maximum of 85.5% in October.