Türkiye will break the public’s back with one decision!  (Türkiye )

New Delhi. The Central Bank of Turkey  (Türkiye ) on Thursday increased its key interest rate (benchmark one week repo rate) by 500 basis points i.e. 5 percent to 40 percent. This increase is double the expectations of economists, who had estimated an increase of 250 basis points or 2.5 percent.

The move was seen as a continuation of the bank’s efforts to tackle high inflation and the decline of the Turkish currency lira. In October, the inflation rate in the country crossed 61 percent.

After the news of interest rate hike, the lira was trading at 28.766 against the dollar, which was slightly stronger against the greenback.
expert
Timothy Ash, emerging markets strategist at BlueBay Asset Management, was one of the few experts who expected a 500 basis points increase in interest rates. He said in a note that a really impressive step has been taken by the Central Bank of the Republic of Turkey. He further said, “They are serious about fighting inflation. We have to give him credit for this.”
Lira falls by 35 percent against dollar
The Central Bank’s decision comes after a series of interest rate hikes that have been painful for Turks. The country aims to reverse skyrocketing inflation and a dramatically weak currency. So far this year, the lira has fallen by 35 percent against the dollar and its value against the greenback has declined by more than 80 percent in the last five years.