Turkish Central Bank expected to keep rates on hold.

By bne IntelliNews April 22, 2014

The Central Bank of Turkey is expected to keep its rates on hold at the monetary policy committee meeting scheduled for April 24 despite pressure from the government.

A CNBC-e poll of 18 economists showed that the Bank is expected to keep its policy rate (one-week repo) unchanged at 10%. Two economists expect a cut in the overnight lending rate (currently at 12%) between 50bp and 25bp. Three of the economists polled by CNBC-e are looking for a cut in TRY reserve requirement.

Earlier this month, PM Recep Tayyip Erdogan called for a rate cut, arguing that the AKP’s strong showing in the March 30 local elections boosted markets and lower interest rates would encourage investments. The PM said that the bank should review its interest rates at an emergency meeting. In response to Erdogan’s remarks, the central bank governor Erdem Basci said that no large rate cut should be expected. Interest rates should be lowered gradually, and an interim monetary policy committee meeting is not necessary, Basci added.

Related Articles

Poland claims there will be “no taboo” in talks with Erdogan

Poland will skip no touchy topics in talks with President Recep Tayyip Erdogan, visiting Warsaw on October 17, the office of President Andrzej Duda said ahead of the visit by the Turkish leader, ... more

Erdogan says he plans talks with lenders on cutting Turkish interest rates

Turkey's President Recep Tayyip Erdogan said on October 13 that he plans to hold talks with both public and private lenders on how to lower interest rates. He did not say, however, when those ... more

Turkey's Erdogan turns fire on US ambassador in diplomatic spat over arrest

Turkish President Recep Tayyip Erdogan has turned his fire on the US ambassador to Turkey for the ... more