Bank of Turkey Keeps Rates on Hold

In its September meeting, the Monetary Policy Committee of the Central Bank of the Republic of Turkey decided to leave the one-week repo policy rate unchanged at 4.5 percent, citing price and financial stability.

Statement bt the Central Bank of Turkey:

Recent data suggest that final domestic demand and exports continue to grow at a moderate pace. The current policy framework is improving the current account balance. The weakness in capital flows, cautious monetary policy stance and the macroprudential measures undertaken will gradually bring down the loan growth rates to more reasonable levels. Accordingly, gradual decline in the current account deficit excluding gold trade is expected to continue. 

Inflation is expected to fall further in the forthcoming period. However, core inflation indicators are likely to hover above the inflation target for some time due to the exchange rate volatility observed during the recent months. The impact of these developments on the pricing behavior is closely monitored. The Committee will maintain the cautious monetary policy stance and implement additional monetary tightening at the appropriate frequency until the medium term inflation outlook is in line with the medium term targets. 

Developments regarding price stability and financial stability will be closely monitored and necessary adjustments will continue to be made in the composition of Turkish lira liquidity provided by the Central Bank. Meanwhile, in order to contain the repercussions of uncertainties in global monetary policies on the domestic economy, increasing the predictability of the Turkish lira liquidity policy is deemed important.

Bank of Turkey Keeps Rates on Hold

Central Bank of the Republic of Turkey | Joana Taborda |
9/17/2013 1:08:51 PM