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CBRT Statement Could Suggest Further Rate Cuts Are Unlikely

TURKEY
  • No analyst surveyed by BBG saw a rate cut of 200bps today, with 100bps being the largest policy change forecast.
  • When forecasting a 100bps rate cut, a number of sell-side analysts saw further cuts before year-end, with some seeing the main policy rate falling as low as 15.00% by the end of 2021.
  • CBRT's statement today that there is "limited room for downward adjustment to the policy rate" could suggest the bank are front-loading these rate cuts and further easing is unlikely. This may see markets adjust to a new presumed floor in the policy rate at 16.00%.
  • This "limited room" phrase was not present in the previous September policy statement, and has been introduced this month for the first time.
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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