Türkiye leaves interest rates unchanged at 50%, meeting forecast

By Tuba Ongun

Türkiye's Central Bank on Thursday left the benchmark one-week repo rate unchanged at 50% for the fourth straight meeting, in line with market forecast.

"Considering the lagged effects of the monetary tightening, the (Monetary Policy) Committee decided to keep the policy rate unchanged, but reiterated that it remains highly attentive to inflation risks," the bank said in a statement.

Highlighting that the underlying trend of monthly inflation dropped notably in June, the bank said it expects a temporarily rise in July due to adjustments in administered prices and taxes besides supply-side factors in unprocessed food prices.

"However, the rise in the underlying inflation is expected to be relatively limited," it added.

Türkiye's annual consumer inflation rate slowed in June as the country's economic management expected, down to 71.60% from 18-month high of 75.45% in May.​​​​​​​ On a monthly basis, Türkiye's consumer price index rose 1.64% in June, easing from May's 3.37% hike.

Inflationary pressures are still alive amid geopolitical uncertainty and higher food and services prices, it stressed.

"Indicators of inflation and underlying trend of inflation will be closely monitored, and the Committee will decisively use all the tools at its disposal in line with its main objective of price stability," the bank noted.