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MNI CBRT Preview: January 2023

TURKEY
  • The CBRT is expected maintain the one-week repo rate at 9.00%, as the bank remains highly politically influenced and willing to look through inflation in excess of 60%.
  • Fundamental pressure on the lira is likely to have increased due to the lack of tourist revenues over the winter period, meaning further rate cuts would make maintaining the lira’s stability more difficult.
  • President Erdogan has said elections will be brought forward to May from the originally scheduled June date, where the path of Turkish macroeconomic policy in H2 2023 could shift drastically. Despite the opposition yet to name a unified contender, current polling suggests that the election is in the balance.
  • Full MNI Preview including sell-side analyst views here

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