Lira gains value against dollar after Central Bank raises interest rate to 24 percent

Turkey’s Central Bank has announced its decision for interest rate. Following the meeting of the Monetary Policy Board in September, the Central Bank increased lending rate by 625 basis points carrying it from 17.75 percent to 24 percent.

After the Central Bank’s interest rate decision, the dollar and the euro fell sharply. While the dollar/TL saw 6.02 level the euro/TL fell to 7. The Central Bank signaled that it would use all its instruments for price stability and announced that weekly funding would start tomorrow.

The statement made by the Central Bank was as follows:

“The Monetary Policy Committee decided to raise the policy interest rate of one week repo auction rate from 17.75 percent to 24 percent. The recently announced data suggest that the trend of equilibrium in economic activity has become clearer. Along with protecting external demand, the slowdown in domestic demand is accelerating.”