IMF official expresses approval for Türkiye's monetary policy
Date
10/27/2024 5:25:12 AM
(MENAFN) Alfred Kammer, the director of the European Department at the International Monetary Fund (IMF), expressed strong approval for Türkiye's stringent monetary policy aimed at reducing inflation. He noted that the IMF has been "very favorably impressed" by the significant shift in monetary policy implemented over the past year. Kammer highlighted two key outcomes of this approach: a substantial decrease in vulnerability to potential crises and a noticeable downward trend in inflation rates.
Despite these positive developments, Kammer cautioned that Türkiye's battle against inflation is ongoing. He emphasized the necessity of maintaining a tight monetary policy and warned that it would be premature to ease these restrictions at this time. According to him, sustaining the current policy stance is crucial to solidifying the progress made.
Additionally, Kammer pointed out the importance of focusing on income policies to further address inflationary pressures. He identified the issue of minimum wage increases being tied to past inflation trends as a significant factor contributing to inflation in Türkiye. He recommended that these agreements be structured in a forward-looking manner, rather than relying on historical data, to prevent second-round effects on inflation.
Kammer also advocated for "more fiscal adjustment," which he believes would not only help mitigate inflation but also enhance the credibility of Türkiye's economic reform efforts. He commended the Turkish economic team for their achievements thus far and underscored the need for continued commitment to these policies. While acknowledging the challenges faced by the population and policymakers during this difficult period, he reiterated the necessity of these measures to reduce crisis risks and achieve lasting inflation control.
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