Photo: Reuters
Istanbul: The Central Bank of Turkey has made an unexpected decision to increase the interest rate by 500 basis points, setting it at 50 percent.
According to a report by Reuters, the Central Bank of Turkey has stated that this decision has been made in view of the deteriorating situation of inflation, and if necessary, further increases may be made.
A continuous increase in the inflation rate has also been predicted in Turkey.
The Central Bank has increased the interest rate significantly at a time when local elections are just 10 days away, while analysts believe that this decision indicates the Central Bank’s determination to show independence from political pressure and control rising inflation.
On the other hand, the value of the Turkish Lira has also improved by 1.5 percent against the dollar, reaching 31.91, compared to the past few weeks when there was a decrease, and there has also been an improvement in the value of Turkish Dollar bonds.