Turkish Central Bank Raises Interest Rate to 25%, Signaling Economic Policy Shift

Turkish Central Bank Raises Interest Rate to 25%, Signaling Economic Policy Shift

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2023-08-24 | 08:40

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Turkish Central Bank Raises Interest Rate to 25%, Signaling Economic Policy Shift

The Turkish Central Bank unexpectedly raised the interest rate to 25%, marking a significant turning point in the unconventional economic policy of President Recep Tayyip Erdogan.

This move followed a previous decision to raise the rate by 2 percentage points last month, and the current increase of 7.5 percentage points came as a surprise. Most economic experts had anticipated the central bank to raise the rate to 20% from 17.5%.

The Turkish Central Bank announced that "recent indicators suggest that the inflation trend is on a continuous rise."

Following the central bank's decision, the exchange rate of the Turkish lira against the dollar increased by 1.5%, indicating a strong signal that efforts to combat inflation and support the struggling local currency are being reinforced.

AFP

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