STORY: Turkish central bank raises interest rate to 15 pct in policy U-turn
DATELINE: June 23, 2023
LENGTH: 00:01:22
LOCATION: Ankara
CATEGORY: ECONOMY

SHOTLIST:
1. various of the Turkish central bank
2. various of Turkish lira
3. various of people at cashpoints in Türkiye
4. various of Turkish lira
5. various of the Turkish central bank
6. Turkish President Recep Tayyip Erdogan
7. various of Hafize Gaye Erkan, the governor of the Turkish Central Bank (courtesy of ihlas news agency)
8. Turkish President Recep Tayyip Erdogan
9. various of the Turkish central bank
10. various of Turkish lira

STORYLINE:

The Turkish central bank on Thursday announced a benchmark interest rate hike from 8.5 percent to 15 percent, in a policy U-turn toward monetary tightening to counter higher inflation.

According to a statement from the central bank, its Monetary Policy Committee made the decision to tighten monetary conditions in order to bring down inflation, stabilize inflation expectations, and control pricing behavior.

"The committee will determine the policy rate in a way that will create monetary and financial conditions necessary to ensure a decline in the underlying trend of inflation and to reach the 5 percent inflation target in the medium term," it said.

The central bank also highlighted that additional measures would be implemented as needed until a significant improvement in the inflation outlook is achieved.

Turkish President Recep Tayyip Erdogan had previously advocated for low-interest rate policies, believing they would help curb inflation. However, the Turkish lira has experienced a significant decline of over 60 percent against the U.S. dollar in the past two years.

Turkish citizens have been grappling with the high cost of living due to soaring inflation, which peaked at 85.5 percent in October last year before easing to 39.59 percent in May.

After winning the latest elections in May, Erdogan appointed several "orthodox" economists and bankers to lead the country's finance and banking system, signaling a shift to the years-long low-interest rates strategy despite high inflation.

Xinhua News Agency correspondents reporting from Ankara.
(XHTV)