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The Central Bank will announce its interest rate decision tomorrow

The Central Bank’s Monetary Policy Committee will announce its interest rate decision tomorrow. The bank kept the policy rate unchanged at 14% at the previous meeting.

The Central Bank of the Republic of Turkiye (CBRT) Monetary Policy Committee will meet on Thursday, August 18, under the chairmanship of Central Bank Governor Sahap Kavcioglu.

On the same day, at 14.00, the seventh interest rate decision of the year will be announced. The bank kept the policy rate unchanged at 14% in the previous meeting.

The market expectations survey for the MPC meeting resulted in the participation of 16 economists.

According to the survey results, all economists predict that the policy rate will be kept constant at 14%.

“The strong course of energy imports negatively affects the current account balance”

In the summary of the Monetary Policy Committee’s last meeting on July 21, it was noted that;

The rise in inflation is driven by the increase in energy costs caused by geopolitical developments, the effects of pricing formations far from economic fundamentals, and strong negative supply shocks caused by increases in global energy, food and agricultural commodity prices. The Board foresees that the disinflationary process will begin with the re-establishment of the global peace environment, together with the steps taken and determinedly implemented to strengthen sustainable price stability and financial stability. In this context, the Board decided to keep the policy rate constant. In order to institutionalize price stability in a sustainable way, the CBRT continues to review a comprehensive policy framework that encourages permanent and strengthened liraization in all policy instruments. Credit, collateral and liquidity policy steps, whose evaluation processes have been completed, will continue to be used to strengthen the effectiveness of the monetary policy transmission mechanism.

In line with its main objective of price stability, the CBRT will resolutely continue to use all the tools at its disposal within the framework of the liraization strategy, until strong indicators pointing to a permanent decline in inflation emerge and the medium-term 5% target is achieved. The stability to be achieved in the general level of prices will positively affect macroeconomic stability and financial stability through the decrease in country risk premiums, the continuation of reverse currency substitution and the upward trend in foreign exchange reserves, and the permanent decline in financing costs. Thus, a suitable ground will be formed for the continuation of investment, production and employment growth in a healthy and sustainable way.

Source: Trthaber / Translated by Irem Yildiz

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