Turkish Central Bank zeros open market liquidity limits
ANKARA- Anadolu Agency
The decision will be effective as of Aug. 12, the bank said in a statement.
Enver Erkan, an economist at private investment firm Tera Yatirim, said tightening liquidity conditions will reduce the supply of cheap funding.
"We expect Turkish lira-weighted average interest rates will surpass the bank's policy rate (8.25%) and hit 9.75%," Erkan said, adding that "the move can be seen as a covert rate hike."
Last Friday, the bank decided to cut liquidity limits in half after the dollar/lira exchange rate hit an all-time high of over 7.30.