Turkish Central Bank leaves short-term rates unchanged

ISTANBUL

The Central Bank left short-term interest rates unchanged on Oct. 20, Doğan News Agency has reported.

The Bank held the benchmark interest rate at 7.5 percent and the overnight rate at 8.25 percent. 

“The marginal funding rate has been kept at 8.25 percent and the borrowing rate has been kept at 7.25 percent. The one-week repo rate has been kept at 7.5 percent,” the Central Bank Committee said in a statement released on Oct. 20.

The slowdown in aggregate demand has contributed to a gradual fall in core inflation, the statement added, while noting that recent developments in exchange rates and other cost factors restrain any improvement in the inflation outlook and thus necessitate the maintenance of a cautious monetary policy stance.

“In light of these assessments, the Committee decided to keep interest rates at current levels … The direction and the timing of the next step in the monetary policy simplification process will depend on subsequent data,” the statement said.

“Future monetary policy decisions will be conditional on the inflation outlook. Taking into account inflation expectations, pricing behavior and the course of other factors affecting inflation, the cautious monetary policy stance will be maintained,” it noted.