Turkish Central Bank

Following the promising June CPI print, international banks have started to lower their inflation expectations for Türkiye.

Last month, consumer prices increased by 1.64 percent from May, which was lower than expected. The annual inflation rate slowed from 75.45 percent to 71.6 percent.

Credit ratings agency S&P on Friday upgraded Turkey's ratings to "B+" from "B", saying that the coordination between monetary, fiscal, and income policy is set to improve, amid external rebalancing.

The credit action comes a week after the Turkish central bank kept its policy rate unchanged at 50%.

The Turkish Central Bank's net reserves are likely to turn positive in 2024, according to analysts at Goldman Sachs.

In a note on the Central Bank's latest rate decision, Goldman Sachs said that it expects rising foreign inflows and a narrower current account deficit to pull the rate of Turkish Lira appreciation further inside the forwards in 2024.

Eyes will be on Fatih Karahan, who took the helm of the Turkish Central Bank last week, as he is set to present the banks' first quarterly inflation report of 2024 on Feb. 8.

The latest data have shown that the Turkish Central Bank's gross reserves have climbed to a new all-time high.

The bank's gross reserves increased from $136.5 billion on Nov. 24 to $140.2 billion on Dec. 1.

Foreign currency reserves rose from $91 billion to $93.2 billion, while gold reserves climbed from $45.5 billion to $46.9 billion.

The Turkish central bank announced today a surprisingly large increase in its main interest rate - by 7 and a half percentage points to 25 percent.

The Turkish Central Bank's international reserves rose from $98.5 billion on May 26 to $108.6 billion on June 30, while the net reserves improved by $14.2 billion over the same period, Treasury and Finance Minister Mehmet Şimşek said on July 11. 

The Turkish lira, which fell today by more than five percent, hit a new historic low against the dollar ten days after the re-election of President Recep Tayyip Erdogan, reported AFP.

Falling for a sixth consecutive month, Türkiye's annual consumer inflation rate slowed to a 16-month low of 43.68 percent in April, according to official data released yesterday.

April's figure, announced by the Turkish Statistical Institute (TÜİK), was down from 50.51 percent in March.
The inflation rate was 69.97 percent in April 2022.

The Turkish Central Bank on April 27 held its interest rate at 8.5 percent in its Monetary Policy Committee's (MPC)  meeting.