Turkey's Central Bank cuts overnight lending rate

ANKARA (AA) - Turkey’s Central Bank on Tuesday cut its overnight lending rate by 50 basis points following recent cuts in the last three months.

The overnight lending rate, which is the rate at which banks borrow from the Central Bank overnight, was cut 50 basis points from 9.5 percent to 9 percent.

The overnight borrowing rate, however, under which banks lend or deposit money to the Central Bank, remained unchanged at 7.25 percent.

The one-week repo rate, known as policy rate, was also kept at 7.5 percent, the bank said.

In late liquidity window interest rates (between 4.00 p.m. - 5.00 p.m.), the borrowing rate has been kept at zero percent, and lending rate has been reduced from 11 percent to 10.50 percent.

"The favorable developments, in terms of trade and moderate course of consumer loans, contribute to the improvement in the current account balance," the bank said in a statement.

"While domestic demand continues to have a positive impact on growth, demand from the European Union economies continues to support exports. Accordingly, economic activity displays a moderate and stable course of growth."

The bank added that implementation of the structural reforms in the country would contribute to potential growth significantly.