THE GUARDIAN: Experts say increase from 8.5% may be insufficient to tackling surging inflation that some estimate at 110%
Turkey’s central bank has raised interest rates for the first time in more than two years, from 8.5% to 15%, but there is widespread concern that the move is insufficient to combat rising inflation and an ongoing economic crisis.
The decision marks a partial shift in the unorthodox economic policy of the president, Recep Tayyip Erdoğan, under which interest rates have been frozen since March 2021 despite a sharp devaluation in the Turkish lira.
The central bank’s monetary policy committee said it had raised rates “to begin the monetary tightening process in order to establish the disinflation course as soon as possible, to anchor inflation expectations, and to control the deterioration in pricing behaviour.”
Inflation has risen to levels that are proving unbearable for large sections of the population, causing a widespread cost of living crisis. Officially, inflation in Turkey is at 39.59%, although unofficial estimates from Turkey’s independent Inflation Research Group put it at 110%. » | Ruth Michaelson | Thursday, June 22, 2023
