The Central Bank will announce the second interest rate decision of the year. Following lower-than-expected inflation signals, it is expected that the CBRT will continue its interest rate reduction cycle. Here are the things to know before the interest rate decision…Eyes are on the interest rate decision following positive signals from inflation. The Central Bank will announce the second interest rate decision of the year today at 14.00. Economists noted that the CBRT’s hand was relieved after the inflation data came in below expectations. It is expected that the CBRT will reduce the policy rate by 250 basis points to 42.5%.
Foreign institutions such as Morgan Stanley, JPMorgan, and Deutsche Bank also predicted a 250-basis point cut for the March meeting. Year-end policy rate expectations have settled at 30%. Economists noted that the message the Central Bank will give to the markets will be closely monitored. At this point, it will be observed whether there will be any changes in the monetary policy text. The Central Bank started the interest rate reduction cycle in December. The CBRT had lowered interest rates by 500 basis points in the following two meetings, bringing it down from 50% to 45%. Turkey’s inflation came in below expectations in February at 2.27% on a monthly basis. In the monthly period, inflation was expected to be around 3%. Annual inflation dropped to 39.05%. Thus, inflation fell below the 40% level for the first time in 20 months.