What Bloomberg Economics Says…
We expect the Central Bank of the Republic of Turkey to keep interest rates unchanged at 14% at its March meeting. The economic conditions justify a tighter policy, but a rate increase is politically unfeasible.
The Russian invasion of Ukraine will sustain Turkish inflation for longer. The war is likely to reduce tourism revenues – Turkey is a popular destination for both Russians and Ukrainians – which will hit the currency. The conflict will also increase energy and food costs. The CBRT’s forecast for year-end price increases of 23.2% seems increasingly unattainable.
— Ziad Daoud, chief economist for emerging markets. For more, read here.
This post Turkey Holds Interest While Ukraine, Fed Test Lira: Decision Guide
was original published at “https://www.bloombergquint.com/politics/turkey-to-hold-rates-as-ukraine-fed-test-lira-decision-guide”