Turkish Central Bank says further monetary tightening may be delivered ‘if needed’

ANKARA

The Central Bank of Turkey may carry out additional monetary tightening “if necessary” as it closely monitors the impact of the latest developments on inflation, pricing behavior and other factors affecting inflation, the bank’s Governor Murat Çetinkaya has said.

In a speech at the bank’s ordinary general board meeting on April 12, Çetinkaya said monetary policy decisions would continue to be made in an effort to maintain price stability.

“I need to mention that we were closely following the impacts of the latest development on Turkey’s inflation outlook,” he said, as quoted by Reuters.

The Turkish Lira was one of the worst performing currencies against the United States dollar in the last month with a nearly 7 percent loss in value in the face of various developments that have fueled investor worries. The lira got a relief on April 12 and slid to 4.1, as concerns over an escalation in a clash of words between the U.S. and Russia eased over Syria.

One of the economy’s weakest points recently has been the country’s high inflation, according to analysts.

The Central Bank’s governor said it would continue to use all of its instruments to maintain price stability. “Considering the main factors that have affected inflation, we may adopt further tightening if needed,” he said.

Çetinkaya said the bank’s main aim was to achieve sustainable price stability.

He also said inflation remained high even though it had regressed to 10.23 percent in the latest months with a slight decline.

Leading indicators from the first quarter showed growth maintained its strength, said Çetinkaya.