Dollar TL rate is near its peak with investors expecting further interest rate cut
While the dollar/TL is moving just below the peak of 8.95, investors who listened to Central Bank Governor KAVCIOGLU yesterday, are observed to be waiting for the interest rate cuts to continue.
The dollar/TL continues to fluctuate just below the new historic peak at 8.95, where the Central Bank (CBRT) rose after the interest rate cut.
While watching the CBRT investor meeting in the markets yesterday, the participants said that President KAVCIOGLU did not directly give a message of an interest rate cut similar to the September meeting, but they still expected the cuts to continue. CBRT, which cut interest rates on September 23, will announce its next interest rate decision on October 21.
THE INFLATION OUTLOOK IS QUITE OPTIMISTIC
According to the participants, KAVCIOGLU’s inflation outlook is quite optimistic. The President of CBRT describes the latest developments as temporary rises. He also says the temporary rise is due to the normalization steps after the outbreak in inflation and it will decline.
According to the information provided by some participants, KAVCIOGLU also stated that core inflation was important, but they had not decided looking at it, only.
THE NEXT MOVE WILL BE A CUT
A senior economist at an asset management company said: “KAVCIOGLU was reluctant to make forward-looking verbal guidance in both directions on interest rates. He was reluctant to say what would trigger the interest rate increase, and also whether there was more room for interest rate cuts. But my impression is that they are definitely on the expansionary side, and the next move will be interest rate cuts.”
The bankers followed this meeting to understand whether the interest rate cut that the CBRT started with 100 basis points in September was a one-time one or the first decision of the discount cycle.
The global value gain in the dollar which came with the CBT’s interest rate cut last month, is the main determinant of the depreciation in TL. On the other hand, the rise in energy prices and their possible impact on the economy have also started to be on the agenda of investors.
