Turkey Increases Interest Rates by 250 Basis Points
In its final meeting of the year, the Monetary Policy Committee of the Central Bank of the Republic of Turkey took bold measures by increasing the policy interest rate by 250 basis points, pushing it to 42.5%. The decision, eagerly anticipated by financial markets, reflects the bank's commitment to addressing economic challenges.
This move follows a series of policy adjustments throughout the year, demonstrating the Central Bank's responsiveness to economic dynamics. After a 50 basis points reduction in February, the bank shifted its stance to tightening from June onwards.
Notably, in June, a significant 650 basis points increase brought the interest rate to 15%. Subsequently, in the past seven meetings, the Central Bank consistently opted for a tightening strategy, culminating in a cumulative increase of 34 basis points for the entire year.
The decision comes amid efforts to combat inflationary pressures and stabilize the economy. The Central Bank's proactive approach signals its commitment to achieving financial stability and underscores its role as a key player in Turkey's economic management.
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