Economic Update: Central Bank Interest Rate Adjustment
The Turkish Central Bank has announced a reduction in the “Ribo” interest rate by 250 basis points, decreasing it from 45% to 42.5%. This decision follows recent annual inflation figures that have shown better-than-expected improvement, enabling the central bank to ease cash tightening measures.
According to data from the Turkish Statistics Institute, the annual inflation rate in Türkiye fell to 39.1% in February, down from 42.1% in January. This figure was below market expectations, which had projected an inflation rate of 39.9%, and marks the lowest level since June 2023.
This is the first instance in 20 months that inflation has dipped below 40%. Contributing to this decline in inflation were reductions in pricing for clothing and healthcare services.
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