Turkey’s Central Bank sharply raised its key interest rate

Центробанк Турции резко повысил ключевую ставку

Before the meeting of the Central Bank President Erdogan called the rate of 17.75% is too high and encouraged to reduce it.

The Central Bank of Turkey following the results of session on Thursday, September 13, raised its key interest rate by 6.25% from 17.75% to 24%. It is reported by Interfax-Ukraine.

It is noted that the Central Bank raises rates for the third time this year, from the end of April it has increased by 11.25%. Analysts expected an increase to 21%.

Before the meeting of the Central Bank on Thursday Turkish President Recep Tayyip Erdogan called the rate of 17.75% is too high and encouraged to reduce it.

In turn, the Turkish Lira went from declining by more than 3% to increase by 5% in tandem with the U.S. dollar, but by 14:45 in Kiev slowed down the rise to 2.5%.

Recall, Argentina and Turkey at the moment are considered the most vulnerable countries in the sense of debt burden, and for events closely investors are watching worldwide. Turkey faced a sharp rise in inflation and a currency crisis, the Lira fell this year by almost 40% in pair with the U.S. dollar.

The consumer price inflation in Turkey accelerated in August to 17.9% yoy from 15.85% in the previous month. The August inflation rate was the highest since 2003.

Previously, the Central Bank of Argentina raised the seven-day rate from 45% to 60%. Today is the world’s highest level. This unprecedented decision was taken in response to the sharp depreciation of the national currency, the peso, which from the beginning of 2018 has lost 54% of its value.

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