Ankara: The Central Bank of Turkiye (CBRT) on Thursday cut interest rates by 300 basis points to 43% , exceeding expectations.
This marks the resumption of a monetary easing cycle that was halted due to political unrest earlier this year. Markets have since stabilized, and inflation has continued to decline.
The CBRT said in a statement accompanying the decision: "The tight monetary policy stance, which will continue until price stability is achieved, will support the inflation reduction process through moderating domestic demand, a real appreciation of the Turkish lira, and improved inflation expectations."
The Turkish regulator's decision was expected by the market, given the slowdown in inflation.
Experts expect inflation in Türkiye to decline from its current level of 35.05% to 30% by the end of this year.
Data from the Turkish Statistical Institute showed that the country's annual inflation rate unexpectedly declined last month, reaching its lowest level since November 2021.
Inflation fell to 35.4 percent in June from 37.9 percent in April.
Thursday's decision marks the first interest rate cut since April, when the bank raised interest rates to 46 percent following the arrest of Istanbul Mayor Ekrem İmamoğlu, which led to a decline in the Turkish lira.
