In Turkey they cut rates: Central Bank Turkey lowered the main rate percentage by as much as 250 basis points, to the level of 47.5 percent This is a deeper cut than expected (it was supposed to be 150 bp). Earlier, for 18 months, the bank tightened its monetary policy as part of the fight against high inflation. Even earlier, he acted very unorthodoxly: the more inflation raged, the more rates were lowered. However, recent actions, reversing the unusual approach, have begun to bring results.
Inflation below 50 percent: The main interest rate in Turkey was kept at 50%. since March last year. Inflation is gradually decreasing, in November it was on an annual basis 47 percentalthough according to some economists, its actual level may be higher than official data. At the worst point in recent years, inflation in Turkey reached 85%. (in November 2022).
The lira is falling, the cost of living is rising: A very unusual approach to monetary policy Recep Tayyip Erdogan pushed (successfully) led to huge turmoil in the economy and a skyrocketing cost of living for the country's inhabitants. The dramatic weakening of the lira has eroded Turks' life savings as well as the country's foreign exchange reserves. The Turkish currency is still in trouble, it has weakened against the dollar by nearly 20% this year. In the spring of 2023, when more orthodox methods of fighting inflation were returned, rates began to increase, from 8.5 percent. in May 2023 to 50 percent in March 2024. Turkey's central bank expects inflation to fall to 21 percent by the end of next year.
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Sources: Associated Press, Reuters.