Central Bank expected to keep rate stable this week

ISTANBUL

The Central Bank’s Monetary Policy Committee (MPC) will meet for the fifth time this year on May 25 to decide about the key interest rate.

Analysts expect the monetary authority to keep its policy rate - one-week repo auction rate - unchanged at 8.5 percent as it did last month.

The committee assessed that the current monetary policy stance is adequate to support the necessary recovery in the aftermath of the earthquake by maintaining price stability and financial stability, the bank said in a statement released after the April MPC meeting.

The MPC meeting will be held three days before the second round of the presidential election.

In an interview with CNN last week, President Recep Tayyip Erdoğan vowed to continue with the policy of cutting interest rates to reduce inflation if he is reelected on May 28.

Inflation will be going down along with interest rates, he said, reiterating his view that the lower the interest rates, the lower the inflation will be.

More economic data

The Central Bank and the Turkish Statistical Institute (TÜİK) will also release other key macroeconomic data this week.

The data on the capacity utilization in the manufacturing sector for May will be out on May 24, while the business confidence index will be released on the same day.

The consumer confidence index data for May will be unveiled on May 22.
The Tourism Ministry will release the number of foreign tourist arrivals in April this week.