Turkey Interest Rate at 5.5% in December

The Central Bank of Turkey decided to cut its benchmark interest rate by 0.25 percentage points to 5.5% in December 2012.

The Committee has stated that, in order to contain the risks on financial stability in the face of accelerating capital inflows, the proper policy would be to keep interest rates at low levels while continuing with macroprudential measures. Accordingly, the Committee has indicated that, in order to support financial stability, it would be appropriate to take additional steps using reserve requirements, while delivering  a limited cut in the policy rate. In the following period, if deemed necessary for financial stability, a measured adjustment in the interest rate corridor might also be considered. 

Ongoing uncertainties regarding the global economy necessitate the monetary policy to remain flexible in both directions. Therefore, the impact of the measures undertaken on credit, domestic demand, and inflation expectations will be monitored closely and the funding amount will be adjusted in either direction, as needed. 

Central Bank of Turkey | Nuno Fontes | nuno@tradingeconomics.com
12/18/2012 12:28:53 PM