
Turkey's Central Bank Slashes Interest Rate Amid Inflation Concerns
ANKARA, Turkey – In a strategic move to navigate its economic challenges, Turkey's central bank slashed its key interest rate by 2.5 percentage points to 45% on Thursday. According to the Associated Press, this marks the second consecutive month of rate cuts as the country grapples with easing yet still substantial inflation levels.
The central bank's Monetary Policy Committee has been proactive, reducing its benchmark one-week repo rate to 45% from the previous 47.5%. This follows a similar reduction in December when the rate was also lowered by 2.5 percentage points. Nevertheless, the bank remains steadfast in its commitment to combat surging inflation, which continues to affect Turkish households significantly.
"While inflation expectations and pricing behavior tend to improve, they continue to pose risks to the disinflation process," the committee emphasized in its statement. The annual inflation rate in Turkey decelerated to 44.38% in December 2024 from 47.09% in the preceding month, as highlighted by the latest data from the IndexBox platform. However, independent economists caution that the true rate may be notably higher, pointing to ongoing economic volatility.
Turkey's inflation has been propelled upwards in recent years, exacerbated by the depreciation of the Turkish lira and President Recep Tayyip Erdogan's atypical economic stance of reducing interest rates in the face of escalating inflation. Despite adopting a different approach in 2023 by implementing a series of rate hikes, Erdogan's administration faces a complex economic landscape.
With these recent developments, Turkey's central bank is making its monetary policy decisions with prudence, evaluating inflation trends on a meeting-by-meeting basis. As the nation continues to balance economic growth and inflation control, the bank's strategies will be crucial in steering Turkey towards economic stability.
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1. INTRODUCTION
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2. EXECUTIVE SUMMARY
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3. MARKET OVERVIEW
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10. PROFILES OF MAJOR PRODUCERS
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11. COUNTRY PROFILES
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LIST OF TABLES
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- Exports, In Physical Terms, By Country, 2012–2024
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LIST OF FIGURES
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- Production Volume And Growth
- Exports And Growth
- Export Prices And Growth
- Market Size And Growth
- Per Capita Consumption
- Imports And Growth
- Import Prices
- Production, In Physical Terms, 2012–2024
- Production, In Value Terms, 2012–2024
- Production, By Country, 2024
- Production, In Physical Terms, By Country, 2012–2024
- Imports, In Physical Terms, 2012–2024
- Imports, In Value Terms, 2012–2024
- Imports, In Physical Terms, By Country, 2024
- Imports, In Physical Terms, By Country, 2012–2024
- Imports, In Value Terms, By Country, 2012–2024
- Import Prices, By Country, 2012–2024
- Exports, In Physical Terms, 2012–2024
- Exports, In Value Terms, 2012–2024
- Exports, In Physical Terms, By Country, 2024
- Exports, In Physical Terms, By Country, 2012–2024
- Exports, In Value Terms, By Country, 2012–2024
- Export Prices, 2012–2024