The Central Bank of Turkey sharply raises the main interest rate – from 8.5 to 15.0 percent

Istanbul Turkey’s central bank has changed the course of monetary policy under new leadership: The new head of the central bank, Hafiz Gay Erkan, announced on Thursday that monetary regulators will raise the key interest rate from 8.5 to 15 percent in the fight against high inflation and currency turmoil.

The Turkish monetary authorities have also indicated that they will add more if necessary. “Monetary tightening will be tightened in a timely and gradual manner as necessary until a significant improvement in inflation expectations is achieved,” the central bank said.

However, the increase was less than expected: most analysts and major banks expected an increase of 20 to 40 percent. Analysts in Türkiye assumed between 12 and 30 percent.

The Turkish lira is under pressure