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CBRT Raise Year-End Inflation Forecast Midpoint to 38% from 36%

TURKEY

Highlights from the CBRT’s inflation report presentation (via Reuters News):

  • 2024 year-end inflation forecast mid-point 38% vs 36% in previous report
  • 2025 year-end inflation forecast mid-point 14% vs 14% in previous report
  • Underlying trend decelerated but remained higher than our forecast
  • Services prices play a significant role in elevated course of underlying trend
  • Inflation is expected to converge gradually to target
  • Project that the lagged effects of the monetary transmission will lead to a weakening in domestic demand in the second half of 2024
  • Monetary policy stance will ensure that deposit rates remain at levels that will support the transition to the Turkish lira, and boost savings
  • Additional monetary tightening delivered in March fostered confidence of resident and non-residents to the Turkish lira and bolstered reserves

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