Turkey’s Central Bank on Thursday kept its one-week repo rate – also known as the policy rate – steady at 19%, in line with market expectations, for the fifth month in a row.
After the committee’s eighth Monetary Policy Committee meeting this year, the bank said strong recovery in global demand and supply problems are pushing up producer and consumer prices alike on a global scale.
“Unfavorable effects of weather conditions in major agricultural commodity exporting countries are observed in global food prices,” it added.
Stressing that the monetary tightening has a decelerating impact on credit and domestic demand, the bank noted: “Taking into account the high levels of inflation and inflation expectations, the current tight monetary policy stance will be maintained decisively until a significant fall in the Inflation Report’s forecast path is achieved.”
At the beginning of this year the policy rate was 17%, and in March the bank raised the rate to 19%.
Turkey’s annual inflation rate stood at 18.95% in July, according to the latest data from the Turkish Statistical Institute (TurkStat).