Turkey’s Central Bank to announce interest rate decision on November 23, 2023

The Central Bank’s decision on interest rates for November is eagerly awaited. The November 2023 Monetary Policy Committee (MPC) meeting, where the policy rate rose to 35% under the leadership of President Hafize Gaye Erkan, will be held today. If there is an increase as expected, the interest rates for TL deposits, credit card cash withdrawals, and late payment fees at the bank will change once again.

Exciting anticipation has begun for the Central Bank’s interest rate decision. The Central Bank of the Republic of Turkey (CBRT) Monetary Policy Committee (MPC) is meeting once again under the leadership of President Hafize Gaye Erkan. While the markets await the announcement of the results for the interest rate decision, institutions are individually answering the question, “What will the interest rate decision be?”

The Committee will announce the results for the November interest rate decision today at 14:00. In its last meeting, the CBRT raised the policy rate by 500 basis points, increasing it to 35%.

Economists’ expectations are that the interest rate hike process will continue with 250 basis points. Messages in the decision text will also be in focus. Clues about the inflation path, the simplification process, and the course of tightening will be closely monitored.

EXPECTATIONS FROM FOREIGN INSTITUTIONS FOR INTEREST RATES

Before the interest rate decision, foreign institutions individually announced their expectations for November and the end of the year. Global financial institutions predicted that the Central Bank would close the year with an interest rate of 40%.

JPMorgan expects a 250 basis point increase in the policy rate in November. It also predicts a 250 basis point increase in the December meeting. Morgan Stanley expects the policy rate to rise to 37.50% with a 250 basis point increase in the November meeting. It anticipes that the CBRT will take a break from interest rate hikes until the end of the first quarter of 2024 and will raise the interest rate to 40% in April 2024. Societe Generale thinks that the policy rate will rise to 37.50% with a 250 basis point increase in the November meeting. It also expects a similar move in December, raising the policy rate to 40% by the end of the year. Goldman Sachs also predicts that the CBRT will continue interest rate hikes this year and expects the policy rate to rise to 40%. It predicts that interest rate cuts will begin in the third quarter of 2024, and by the end of the year, the interest rate will fall from 40% to 25%.