EMEA Economic Comment: Turkey: CBRT unchanged as expected

Research evidence excerpt

EMEA Economic Comment: Turkey: CBRT unchanged as expected

Global Research

23 July 2026ab

EMEA Economic Comment Economics

EMEA EmergingTurkey: CBRT unchanged as expected

Gyorgy Kovacs

Economist

MPC keeps rates on hold as expected gyorgy.kovacs@ubs.com

+44-20-7568 7563

The Central Bank of the Republic of Türkiye (CBRT) kept its policy rate (one-week repo

auction rate) on hold at 37.0%, and also maintained the O/N lending rate and O/N Nimrod Mevorach

Strategistborrowing rate unchanged at 40% and 35.5% respectively. This is the fourth

nimrod.mevorach@ubs.com

consecutive meeting, when the Monetary Policy Council (MPC) decided to keep policy +44-20-7567 0779

rates flat. The decision came in line with our view and the consensus, although the key

debate was whether the effective rate at 40% (given the suspended one-week repo

auction) would be lowered or not, which has not happened. The recent increase in oil

prices and the fact that there was a USD 5.3bn increase in FX deposits last week given

the geopolitical developments are likely to have also played a role in the CBRT's decision

to keep rates on hold.

MPC maintains the guidance from June

The forward-looking part of Today's MPC statement maintained the key messages from

the June one. First, "monetary policy decisions are made prudently on a meeting-by-

meeting basis" and "in case of a significant and persistent deterioration in the inflation

outlook, monetary policy stance will be tightened". Second, the Committee reiterated

that it "remains highly attentive to upside risks on inflation". When analysing the

incoming data the assessment was mixed: while underlying inflation is likely to creep up

in July temporarily following decreasing slightly in June, the MPC continues to see

confirmation that domestic demand is weakening.