Turkish Lira Hits Record Low

2026-05-15 02:22 By Kyrie Dichosa 1 min. read

The Turkish lira fell past 45.5 per US dollar in mid-May, hitting a fresh record low after the central bank signaled that disinflation will be slower than previously expected amid energy and food price shocks linked to the Middle East conflict.

This comes against the backdrop of a disinflation strategy that relies on maintaining a degree of real appreciation in the lira, aiming to prevent currency depreciation from outpacing inflation and gradually anchor price stability.

However, this approach is under strain as inflation pressures remain elevated.

Policymakers now project end-2026 inflation at 26%, above the 15%–21% forecast range set in February.

Consumer prices also rose 4.18% month-on-month in April, pushing the annual inflation rate to 32.37%, a six-month high and above market expectations of 31%.

In response, the central bank has kept its policy rate at 37% for two straight meetings but has effectively tightened liquidity by lending at a higher 40% rate since the conflict began.



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