Turkey's Central Bank Cuts Rates by 150 Basis Points to 38% as Disinflation Gains Momentum
Turkey's central bank delivered a larger-than-expected 150 basis point rate cut to 38%, signaling confidence in disinflation after November inflation cooled to 31.1% year-on-year, though markets remain skeptical of the bank's ambitious 16% target by end-2026.
Turkey 
TR delivered a policy surprise on Thursday, with its central bank slashing the benchmark one-week repo rate by 150 basis points to 38%, exceeding the median market forecast of a 100 basis point reduction. The aggressive cut signals renewed confidence that disinflation is back on track after summer price pressures temporarily derailed the easing cycle.
TR delivered a policy surprise on Thursday, with its central bank slashing the benchmark one-week repo rate by 150 basis points to 38%, exceeding the median market forecast of a 100 basis point reduction. The aggressive cut signals renewed confidence that disinflation is back on track after summer price pressures temporarily derailed the easing cycle.The decision comes as inflation data over the past two months validated the central bank's optimism. Consumer prices rose 31.1% year-on-year in November, with a monthly increase of just 0.87%, both readings coming in below market expectations. Easing food prices provided significant relief after contributing to inflation volatility earlier in the year.
