Turkey's central bank hikes rates by 500 basis points
Turkey’s central bank hiked interest rates by 500 basis points on Thursday to 40%, but signalled it was getting close to the end of the tightening cycle.
Economists were expecting a 250-basis point increase.
Data released earlier this month showed that inflation in Turkey was 61.36% in October, barely changed from September’s 61.53%, having peaked at 85% in October 2022.
The central bank said: "The Committee assessed that the current level of monetary tightness is significantly close to the level required to establish the disinflation course.
"Accordingly, the pace of monetary tightening will slow down and the tightening cycle will be completed in a short period of time. The monetary tightness will be maintained as long as needed to ensure sustained price stability."
Liam Peach, senior emerging markets economist at Capital Economics, said: "A final 250bp hike in December now looks likely.
"For the central bank to have any chance of achieving single digit inflation this decade, rates will need to stay at this level for some time."