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CBRT Move to Narrow Gap Between Loan Rates and Benchmark

TURKEY
  • Dunya today write that the CBRT benchmark rate could be on its way to single digits after yesterday’s surprise rate cut, with analysts seeing further cuts at the October meeting.
  • In a bid to close the spread between commercial loan rates and the bank benchmark (specifically cited in yesterday’s CBRT statement), the central bank are to lower commission fees charged on loans, in response to business requests that the commission payments are keeping borrowing costly.
  • Later today, Erdogan attends a meeting to assess the economy – at which there will likely be a particular focus on creating an alternative to the Russian Mir payments system, which a number of commercial banks have stopped using for fear of running against US Treasury sanctions. The systems are a strong source of FX income for Turkey, with the payment rails heavily used by Russian tourists.
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com
MNI London Bureau | +44 203-865-3809 | edward.hardy@marketnews.com

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