Central Bank of Turkey keeps its policy interest rate steady at 14 percent

The Central Bank (CBRT) decided to keep the policy interest rate constant at 14 percent at its meeting today. The market expectation was that the interest rate would be kept constant.

The statement made by the bank pointed to long-term investment loans and said “It is important for price stability that the recovery trend in the current account balance continues to strengthen. The Board evaluates that long-term Turkish lira investment loans will play an important role to achieve this goal.”

After the decision, the dollar/TL was 13.61 and the euro/TL was horizontal at 15.50.

The CBRT which started cutting rates in September 2021, had reduced the interest rate by 500 basis points by the end of the year. After the dollar/TL increased from 8.30 to 18.36 in this period, it was balanced around 13.50 by the sale of reserves and exchange rate-protected deposits.