Turkey’s Central Bank holds interest rates steady after aggressive hikes

ANKARA — Turkey’s Central Bank on Thursday kept interest rates at 45%, pausing a monetary tightening policy after eight straight months of rate hikes.  

The move was widely expected, with the bank’s management earlier this month signaling that it would pause the hikes after eight consecutive increases that gradually raised the country’s policy rates from 8.5% to the current level between last June and this January. 

Thursday’s Monetary Policy Committee meeting marked the first one under the bank’s new governor, Fatih Karahan, who took over the post after his predecessor, Gaye Erkan, resigned earlier this month amid charges of misconduct.  

At Karahan’s first press conference as governor earlier this month, he said the bank’s management had assessed that no additional rate hikes were “necessary,” but added that the bank wouldn’t hesitate to resume monetary tightening if the country’s inflation outlook deteriorated.

Turkey’s year-on-year inflation soared to 64.86% in January, with monthly consumer prices increasing by 6.7%, according to official data.

This is a breaking story and will be updated.