Turkey central bank survey points at another rate cut this month

Published 12 Nov,2021 via Bloomberg Markets–Participants in the Turkish central bank’s monthly survey expect another reduction in the benchmark interest rate this month, followed by a pause.

Turkey will slash its key rate by 100 basis points to 15% on Thursday, according to the survey of 48 people, mostly finance and corporate sector representatives. That matched the median estimate in a Bloomberg poll. However, participants in the central bank study see the rate unchanged at 15% three months later.

The year-end inflation expectations of the participants climbed to 19.31% from 17.63% in October’s poll. The lira was seen weakening to 9.98 per dollar by the end of the year.

The central bank has cut its benchmark rate by a total of three percentage points in September and October, triggering a rout in the lira. The currency weakened more than 10% against the dollar this quarter, the worst among all major currencies tracked by Bloomberg.

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