Turkish Central Bank aims to bring inflation down to 21 percent by end of year
Date
1/19/2025 8:25:57 AM
(MENAFN) The governor of the Turkish Central Bank, Fatih Karahan, announced on Thursday that the bank aims to bring inflation down to 21 percent by the end of the year. Speaking at an event in the central province of Eskisehir, Karahan highlighted that a reduction in the country's risk premium had led to a USD7 billion annual decrease in foreign interest burdens. He emphasized that the central bank's firm stance on monetary policy has been instrumental in lowering monthly inflation and supporting the disinflation process, driven by factors such as a rebalancing in domestic demand, real appreciation of the Turkish lira, and improved inflation expectations.
Karahan further pointed out that the stronger coordination of fiscal policy will play a key role in helping achieve the targeted inflation reduction. He credited the measures taken in the initial phase for preventing inflation from rising to even higher levels. The bank's monetary policy stance has been crucial in curbing inflationary pressures, which has helped improve the broader economic environment.
The governor also stated that the central bank would maintain its tight monetary policy until there is a significant and permanent reduction in the underlying trend of inflation. This approach will continue until inflation expectations align with the projected target range. Karahan confirmed that the central bank's policy rate will be adjusted to ensure the necessary tightness to support the disinflation process.
Looking ahead, he emphasized that the central bank’s decisions would be driven by a cautious, inflation-focused approach, with regular assessments to guide policy adjustments. The bank aims to align its actions closely with the evolving inflation outlook.
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