CBRT Cuts Policy Rate by 100 Basis Points

The Central Bank of the Republic of Turkey (CBRT) announced on Thursday that it lowered its policy (one-week repo) rate by 100 basis points to 14% from 15%. This decision came in line with the market expectation.

The Turkish lira fell against the US dollar to a record low this morning before the interest announcement, to exceed the levels of 15 Turkish lira to the dollar.

The Turkish lira is expected to continue to free-fall in light of the rise in the US dollar index after the Federal Reserve announced an acceleration of the pace of ending bond purchase programs, and expectations of rising interest rates 3 times during the next year