November 23 (SeeNews) - Turkey's central bank said it decided to cut its one-week repo rate from 16% to 15% in response to high inflation levels.
"The recent increase in inflation has been driven by supply side factors such as rise in food and import prices, especially in energy, and supply constraints, increase in administered prices and demand developments. The revision in the monetary policy stance began to affect commercial loans positively," the central bank said in a statement last week.
The central bank expects that the transitory effects of supply-side factors and other factors beyond monetary policy’s control on price increases will persist through the first half of 2022. The bank will consider to complete the use of the limited room implied by these factors in December, it said.
The central bank also said that it will continue to use decisively all available instruments until strong indicators point to a permanent fall in inflation and the medium-term 5% target is achieved in pursuit of the primary objective of price stability.
The central bank last changed its policy rate in October, cutting it to 16% from 18% to eliminate risks to the inflation outlook.
According to the most recent data published by TurkStat, the country's consumer price index (CPI) rose 19.89% year-on-year in October, after increasing by an annual 19.58% in the previous month. CPI added 2.39% month-on-month in October, following a 1.25% increase in September.