Market interest rates in Türkiye expected to drop to single digits: Minister

Economy News 27 November 2022 11:37
TurkicWorld Daspina Hasanova
Market interest rates in Türkiye expected to drop to single digits: Minister

Following the Central Bank’s cut in its policy rate, market interest rates are expected to come down to single digits, Turkish Treasury and Finance Minister Nureddin Nebati has said, Trend reports citing Hurriyet Daily News.

He noted that after two years the policy rate declined to a single digit, thanks to the economic policies designed in line with the “realities of our country“.

The Central Bank on Nov. 24 slashed the one-week repo auction rate by 150 basis points from 10.5 percent to 9 percent, cutting the key rate for the fourth consecutive month.

“With the policies implemented under the Türkiye Economy Model, and measures taken by coordinated efforts of our institutions, the spread between policy and interest rate is gradually narrowing,” Nebati wrote on Twitter.

“We are expecting market interest rates to come down to single digits in the period ahead. Thus, the Turkish economy will continue its path vigorously at a time when recession fears intensify across the world. The Turkish economy will continue to rise on the pillars of the Model,” he said.

The Central Bank said in a statement released after the rate decision that considering the increasing risks regarding global demand, [the Monetary Policy] Committee evaluated that the current policy rate is adequate and decided to end the rate cut cycle that started in August.

“The rate of credit growth and allocation of funds for real economic activity purposes are closely monitored. In addition, the spread between policy rate and the loan interest rates driven by the announced macroprudential measures is closely monitored,” it said.