The Central Bank of Turkey lowered the key rate to 47.5% per annum

December 26th. /MEDIA TALK/. On December 26, 2024, the Central Bank of Turkey reduced the base interest rate from 50% to 47.5%. This happened for the first time in almost two years. The decision is explained by the steady decline in inflation: in November, the level was a record low of 47.09%, compared with 48.58% in October, the lowest since June 2023. In the future, the regulator suggests combating price increases on the way to achieving the inflation target of 5% per year by limiting domestic demand, strengthening the Turkish lira exchange rate and influencing the inflation expectations of the population and businesses.


Photo: ru.freepik.com

The head of the Central Bank of Turkey, Fatih Karahan, previously stated that by the end of the year it is expected to reach 44% of inflation, and in a year to reduce the figure to 21%. In June 2023, the Central Bank of Turkey for the first time increased the base interest rate from 8.5% to 15%, and then periodically adjusted it upward until March 2024. After that, he kept the interest rate at 50% for eight months.

At the last meeting on December 20, 2024, the Board of Directors of the Central Bank of the Russian Federation decided to leave the key rate unchanged at 21%. According to the Russian financial regulator, the current market situation contributes to the fact that the inflation rate began to decrease and reached the target, despite the rising cost of goods and high domestic demand.