CENTRAL BANK RAISES YEAR-END INFLATION FORECAST TO 28 PERCENT
The central bank has raised its year-end inflation forecast for 2026 to 28 percent from 26 percent.
Analysis
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CENTRAL BANK HOLDS MAIN INTEREST RATE AT 37 PERCENT
The central bank kept its benchmark policy rate unchanged at 37% for the third consecutive meeting on June 11, matching the consensus forecast of economists. The Monetary Policy Committee also held its overnight lending rate at 40% and its borrowing rate at 35.5%. The central bank last altered its policy rate in January with a 100-basis-point cut.
ECONOMIC GROWTH SLOWS AS FORECASTS REVISED DOWNWARD
The Turkish economy grew by 2.5% in the first quarter of 2026 compared to the same period last year, lower than the 2.7% growth expected by economists. TurkStat data showed that quarter-on-quarter GDP growth remained at 0.1%. Household consumption made the largest contribution to growth with 3.4 percentage points. However, industrial production contracted. Also, the negative contribution of net foreign trade expanded.
RISING FORECASTS, OPPORTUNIST PRICING
Turkey's inflation and high cost of living show no sign of easing. A new Central Bank survey points to rising price expectations — coming just days after the bank officially revised its own forecasts upward.