MB keeps interest rate constant

img
ANKARA - The bank has held its one-week repo rate unchanged at 8.25 percent, keeping it steady for the second straight month.
 
The Central Bank has decided to keep the policy rate (one-week repo auction rate) constant at 8.25 percent.
 
Pointing to coronavirus developments which substantially weakened global growth in the second quarter, a statement by the bank's Monetary Policy Committee stated that despite a partial recovery in global economic activity in the third quarter thanks to normalization steps, uncertainty in the global economic recovery remains high.
 
"Although tourism revenues declined due to the pandemic, easing travel restrictions are expected to contribute to a partial improvement," it noted.
 
The bank also said the recovery in exports of goods and low commodity prices will support the current account balance in the coming periods.
 
It reiterated that demand-driven disinflationary effects will become more prevalent in the second half of the year, but risks on the end-year projection are considered to be on the upside due to recent developments in inflation.
 
The bank made it clear that maintaining a sustained disinflation process is a key factor for achieving lower sovereign risk, lower long-term interest rates, and stronger economic recovery.
 
"Economic recovery, which started in May following gradual steps towards normalization, is gaining pace," the Central Bank noted.
 
"Recent monetary and fiscal measures that aim to contain negative effects of the pandemic on the Turkish economy contribute to financial stability and economic recovery by supporting the potential output of the economy.
 
"Although tourism revenues declined due to the pandemic, easing travel restrictions are expected to contribute to a partial improvement. The recovery in exports of goods and low levels of commodity prices will support the current account balance in the upcoming periods."
 
"Despite the restraining effects of aggregate demand conditions, pandemic-related rise in unit costs have led to an increase in the trends of core inflation indicators," the statement said.
 
"International commodity prices have continued to restrain consumer inflation, while food inflation has risen due to seasonal and pandemic-related effects. As the normalization process continues, supply-side factors, which have prevailed recently due to pandemic-related restrictions, will phase out.
 
"Indeed, leading indicators show that monthly price increases have started to slow down in services groups that have been subject to capacity constraints during the normalization process. The Committee maintains the view that demand-driven disinflationary effects will become more prevalent in the second half of the year, but risks on the end-year projection are considered to be on the upside due to recent realizations in inflation.
 
In June, the bank kept its one-week repo rate at 8.25 percent, following a gradual cut of 375 basis points from 12 percent in the preceding months.
 
Last year, in eight MPC meetings, the bank cut the rate by a total of 1,200 basis points, from 24 percent.
 
After eight of the meetings last year, this year the bank boosted the number of MPC meetings to 12.

View More Articles

10/11/2020
13:52 Attorneys of Öcalan submits new application to visit İmralı
13:51 General meeting request from HDP for the 'solution of the crisis'
13:51 HDP Executives detained in Erzurum
10:34 Berwarî: Turkey and KDP causes crisis while Öcalan is the adress to solution
10:00 Hashtag #YazmasalardıBilmeyecektik for journalists
09:59 Two soldiers die after Russian helicopter shot down in Armenia
09:58 HDP Osmaniye Provincial Co-chairs jailed in Osmaniye
09/11/2020
15:03 Durna: Pro-government media remaining silent about the resignation indicates a legitimacy crisis
12:57 Journalist Oruç released from prison
12:32 Altıntaş: Erdoğan is the one who should resign as the responsible party for the economic crisis
12:32 Lawyer and United Revolutionary Party chair Sinan Varlık jailed
12:25 Number of detainees increases to 10 in Cizre
10:59 Peace Mothers to Barzani: No more tears!
10:59 Peköz: Ankara's move against North and East Syria became more difficult
09:54 Home raids in Cizre: 5 detained
09:53 Turkey's finance minister announces resignation on Instagram, government, media keep silent
07/11/2020
11:55 YNK's Sengawi: We informed KDP that we are not in favor of war
11:54 Prison guards to prisoners: You're gonna end up dead anyway
11:54 Artist Benli was sentenced to 10 months for sweing his matress
11:53 Trifle fine for police who killed two minors sleeping in their home with a water cannon
09:56 No criminal investigation against destruction of gravestone
07:51 Journalist İbrahim Karakaş remanded in custody
06/11/2020
15:20 30 students detained in YÖK protests
15:19 October Press report of DFG: 11 journalists detained, 4 arrested
15:05 Kurdish politicians: We are one, we don't want to face each other
15:04 PYNK member Bektaş: Turkey is afraid of the recognition of the Autonomous Administration
15:01 Kurdistan Alliance: National Unity is everyone's responsibility
15:00 Journalists Salaz: If the clashes begin, it won't be limited with the mountains
12:28 Families submit application to visit İmralı
12:27 Dozens of families made AKP members in return for aid
12:12 Operation against Education Union: 13 teachers detained
12:12 HDP announces 'Democratic Action Program'
04/11/2020
16:23 HDP Women's Assembly: We are taking to streets against male-state violence
16:22 Police storms HDP Osmaniye District Organization building
16:02 2 years 4 months prison sentence for Roza- Country of Two Rivers documentary
14:45 November 4 message from imprisoned HDP MPs
10:45 Search and rescue efforts ends: 114 people died
10:28 HDP statement on November 4: Democratic politics continues
10:15 Attorneys of citizens thrown from helicopter applies to Constitutional Court
10:14 İzmir earthquake: Death toll hits 112
10:14 ISIS claims responsibility for Vienna shooting
10:13 Three more HDP politicians imprisoned in "Kobanê investigation"
03/11/2020
14:26 Men killed 29 women in a month
14:25 Yoleri: Detainees went on a hunger strike
12:39 Attorneys of Öcalan submit new application for İmralı
12:39 Prisoner suffering from cancer diagnosed with Covid-19 in prison
10:17 İzmir earthquake: Death toll hits 100
10:16 Xelef from the Êzidî Women's Committee: We don't want those who betrayed and ran away
10:15 Death toll in İzmir rises to 95
02/11/2020
16:37 Co-chairs attending the congress of their own party deemed a crime