Monetary Policy Committee aligns with pressure from Turkish President Recep Tayyip Erdogan on lower borrowing costs, lowering one-week repurchase rate by 100 basis points
Turkey's central bank cut its key interest rate for a third month today, but said it would consider ending the easing cycle in December amid a weakening currency and worsening inflation outlook in the country.
The Monetary Policy Committee has come under pressure from Turkish President Recep Tayyip Erdogan for lower borrowing costs, lowering a one-week repurchase rate by 100 basis points to 15%. The move was in line with Bloomberg's average poll of 24 economists and the central bank's own monthly survey.
New negative record for the pound
Meanwhile, one negative record after another breaks the Turkish pound, as the Turkish currency exchange rate is close to breaking the barrier of 11 pounds per dollar (it has reached 10.92 during today's session), having almost lost 8% of its value in just one week.
The currency has lost more than 28% so far this year against the dollar. The devaluation of the pound - the worst in emerging markets - raises prices through imports, while the pound is also hit by the recent rise of the dollar.