Markets

Dollar / TL decreased after the CBRT decision

Turkish lira gained value against the dollar after the interest rate decision of the Central Bank of the Republic of Turkey.

(mtag101702)

While the CBRT kept the policy rate constant at 19 percent, the median expectation of 21 institutions participating in the Bloomberg HT survey was that the central bank would not make any changes at the July meeting and would keep the policy rate constant at 19 percent.

(mtag101702)

While there has been a decline against the dollar in general in the currencies of developing countries since the beginning of last week, the Turkish lira became the third developing country currency unit that gained the highest value against the dollar, despite an almost flat course with an increase of 0.21%.

(mtag101702)

Turkey’s credit default risk premium (CDS) is around 390 basis points, while the 2-year benchmark bond rate is around 18.92 percent.

(mtag101702)

Messages about money politics have not changed

(mtag101702)

In the text published by the CBRT, it was seen that the messages given in the previous meetings on monetary policy did not change. In the final decision, it was emphasized that the slowing effects of cash tightening on loans and domestic demand were observed.

(mtag101702)

Taking into account the high levels of inflation and inflation expectations, the statement was reiterated that the current tight stance in monetary policy will be resolutely maintained until the obvious decline in the projection path of the April Inflation Report is achieved.

(mtag101702)

The message was also renewed that the policy rate will continue to be formed at a level above inflation, in a form that will maintain the strong disinflationary effect, until strong indicators pointing to a permanent decline in inflation and the medium-term target of 5 percent is reached.

(mtag101702)

(mtag101702)

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