- Turkish central bank cuts policy rate by 1.5% to 10.5% in October
Market news
Turkish central bank cuts policy rate by 1.5% to 10.5% in October
The Central Bank of the Republic of Türkiye (CBRT) cut its benchmark interest rate, the one-week repo rate, by 1.50% from 12.0% to 10.50% on Thursday.
Markets had expected the central bank to slash rates by 1% to 11.0% this month.
Key takeaways from policy statement
Will continue to further strengthen the tools supporting the effectiveness of the monetary transmission mechanism.
Spread between policy rate and the loan interest rates driven by the announced macroprudential measures is closely monitored.
Leading indicators for the second half of the year continue pointing to a slowdown in growth due to the weakening foreign demand.
One risk is likelihood of a recession in main trade partners.
Pressures on manufacturing industry are being monitored closely.
Market reaction
USD/TRY came under heavy selling pressure, despite a bigger-than-expected rate cut by the CBRT. The spot was last seen trading at 18.59, modestly flat on the day.
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