Türkiye cuts interest rate to 9 percent, in line with market expectations

The Turkish Central Bank has cut its policy rate by 150 basis points, in line with market expectations.

The one-week repo rate, also known as the policy rate, fell to 9 percent from 10.5 percent, the central bank said in a statement on Thursday following its Monetary Policy Committee meeting.

The bank stressed that it had decided to end the cycle of rate cuts that started in August as its current level is "adequate.”

At its last meeting in October, the bank cut the rate by 150 basis points to 10.5 percent, meaning that the key rate has been lowered by 450 basis points, or 4.5 percentage points, since August.

The Central Bank “will continue to use all available instruments decisively within the framework of liraisation strategy until strong indicators point to a permanent fall in inflation and the medium-term 5 percent target is achieved in pursuit of the primary objective of price stability," the bank said.

The fourth straight cut underscores Türkiye’s monetary policy approach, which believes that lower rates will cool inflation.