Turkish presidential adviser sees interest rates continuing to fall

He also said he thinks that capital inflows will accelerate the decline in interest rates, in an interview on state broadcaster TRT Haber. 

“I believe the rates will continue to decline. In exchange rates, I think the U.S. dollar-Turkish Lira parity will stay at around 2.8-2.85,” he noted, adding that there was no reason to push this value up or down in the short-term. 

Bulut also said he believed new Central Bank Governor Murat Çetinkaya’s market view would be very positive for Turkey, both in the medium-term and the long-term. 

Çetinkaya kicked off his first meeting as Central Bank governor on April 20 by trimming the top end of the bank’s interest rate corridor by 50 basis points, in line with expectations. 

As expected, the Central Bank left its benchmark repo rate unchanged at 7.5 percent and instead cut the upper band of its interest rate corridor by an expected 50 basis points, to 10 percent. The bank cut the same rate by 25 points last month for the first time in 13 months.