Following the March policy meeting, The Central Bank of the Republic of Turkey (CBRT) announced on Thursday that it left its policy (one-week repo) rate unchanged at 14% as expected.

Market reaction

USD/TRY edged higher with the initial market reaction and was last seen gaining 1% on the day at 14.7550.

Key takeaways from policy statement

"Temporary effects of pricing formations that are not supported by economic fundamentals."

"Disinflation process expected to start on the back of measures taken."

"Will pursue disinflation decisively."

"Cumulative impact of the recent policy decisions is being monitored."

"Comprehensive review of the policy framework continues with the aim of encouraging permanent and strengthened liraization."

"Increase in inflation in the recent period has been driven by rising energy costs resulting from the heightened regional conflict."