Turkey’s central bank chief implies further rate cuts in line with falling inflation

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Central Bank Governor Murat Uysal PHOTO: Bloomberg

Turkey’s central bank will set monetary policy in line with developments in inflation, which is expected to fall to single digits by the middle of this year, the bank’s governor Murat Uysal said on Wednesday, Reuters reported.

Uysal was responding to a question by broadcaster NTV about the criteria for reducing interest rates to single figures, after the bank trimmed its policy rate to 11.25 percent last week.

Uysal said the bank has entered a period of fine tuning its monetary policy and will determine future steps based on new data. With inflation forecast to fall back to single figures, the outlook was for positive real interest rates, he said.

President Recep Tayyip Erdoğan, a self-declared “enemy of high interest rates,” appointed Uysal central bank governor after firing his predecessor for his refusal to cut interest rates.

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