Central Bank Takes Decisive Action

In a significant move to combat inflation, the Central Bank of the Republic of Turkey (CBRT) has announced an increase in its policy rate from 42.5% to 46%. This decision underscores the bank's commitment to a tight monetary stance aimed at stabilizing the economy.

Strengthening the Disinflation Process

The bank highlighted that this aggressive monetary policy is designed to moderate domestic demand, appreciate the Turkish lira in real terms, and improve inflation expectations. "Our tight monetary stance will be maintained until we achieve price stability and a sustained decline in inflation," the CBRT stated, emphasizing the importance of fiscal policy coordination in this endeavor.

Future Goals and Current Inflation Trends

With the annual inflation rate in Turkey dropping to 38.1% in March, the CBRT remains focused on its long-term target of reducing inflation to 5%. The bank assures that all upcoming monetary policy decisions will be geared towards curbing inflation's upward trajectory and achieving this goal.