ZCZC
BCN-12
TURKEY-ECONOMY-BANK-RATES
Turkey cuts interest rate by 2.5 percentage points
ANKARA, Oct 24, 2019 (BSS/AFP) – Turkey’s central bank on Thursday cut its main interest rate by 2.5 percentage points, the third consecutive cut after the government sacked the bank’s governor in July.
The bank said the one-week repo rate was lowered to 14 percent, after cuts in July and September, given that the “moderate recovery in economic activity continues” while “inflation outlook continued to improve”.
Inflation dropped below 10 percent to 9.26 percent in September, the lowest level in nearly three years, according to official figures published earlier this month.
Consumer prices were at 15.01 percent in August, a 15-month low at the time.
The consensus forecast of analysts surveyed by Bloomberg financial news service was for a a cut of one percentage point.
The Turkish lira slid 0.5 percent in value against the US dollar following the announcement, to trade at 5.75 lira for one dollar.
President Recep Tayyip Erdogan has repeatedly railed against interest rates, claiming in the past that they are the “mother and the father of all evil”.
Erdogan fired central bank governor Murat Cetinkaya in July, reportedly because the two men clashed over reducing rates.
The MPC is due to meet for the last time in 2019 on December 12.
BSS/AFP/MMA/1920HRS