The Central Bank of Turkey Maintains Interest Rate at 50%

The Central Bank of the Republic of Turkey has chosen to keep its key interest rate unchanged at 50%, signaling a firm stance on monetary policy.

For the second consecutive month, Turkey's key interest rate remains at 50%. The decision to retain the current monetary policy indicators at a record level since August 2002 is attributed to high inflation rates in the service sector, along with geopolitical risks and increasing food prices.

Authorities anticipate that inflation in the country will begin to decelerate next month and reach 38% by the end of the year.

It's worth noting that in March, the Turkish Central Bank raised the interest rate by 500 basis points, from 45% to 50%, marking the highest level in 22 years. This decision was made amidst escalating inflation, surpassing initial forecasts.

On April 25, the regulator opted to maintain the key interest rate at 50% annually. Prior to this decision, the regulator had been increasing the rate for eight consecutive months.