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EIU also expects the Bank of Japan will exit its negative interest rate policy in the second quarter. Markets currently expect the Fed to start with a 25-basis-point rate cut in June. Euro zoneThe European Central Bank last week also held its policy rate at a record high of 4%, signaling that it won't cut rates before June. JPMorgan said in a research note that the Turkish central bank may cut its policy rate in November and December, keeping its year-end policy rate forecast of 45%. IndonesiaIndonesia's central bank kept its benchmark policy rate at 6% in its recent meeting.
Persons: EIU, Jerome Powell, LSEG, Nomura, Perry Warjiyo, CNBC's JP Ong, BOK, Goldman Sachs, Goohoon Kwon, Kwon Organizations: Getty, Economist Intelligence Unit, Bank of Japan, United, United States U.S, Federal, Fed, European Central Bank, ECB, Swiss National Bank, UBS, Bank of Canada, Bank of, JPMorgan, Reserve Bank of, ANZ, New Zealand Auckland Savings Bank, Bank, Bank Indonesia, BMI, Fitch Solutions, U.S, Oxford Economics, Macquarie Locations: Czech, China, Japan, United States, Switzerland Swiss, Bank of Canada, Turkey, Turkish, Reserve Bank of Australia, New, Indonesia, South Korea, Asia
Turkish annual inflation soars to 67% in February
  + stars: | 2024-03-04 | by ( Natasha Turak | ) www.cnbc.com   time to read: +3 min
Turkish annual consumer price inflation soared to 67.07% in February, the Turkish Statistical Institute said Monday, coming in above expectations. Analysts polled by Reuters had anticipated annual inflation would climb to 65.7% last month. The combined sector of hotels, cafes and restaurants saw the greatest annual price inflation increase at 94.78%, followed by education at 91.84%, while the rate for health stood at 81.25% and transportation at 77.98%, according to the statistical institute. "Obviously a disappointing set of inflation prints this morning," Timothy Ash, emerging markets strategist at BlueBay Asset Management, wrote in a note. He added that this development has "continued to put downward pressure on the lira," creating an inflation pass-through.
Persons: Liam Peach, Mehmet Simsek, Turkey's, Timothy Ash, Ash Organizations: Turkish Statistical Institute, Reuters, Food, Economics, Capital Economics, Turkish, BlueBay Asset Management, FX Locations: Sariyer, Istanbul, Turkish, London
Turkey is expected to head to the polls on Sunday. Turkey's central bank held its key interest rate on Thursday, keeping it at 45% despite soaring inflation after eight consecutive months of hikes. The move was widely expected as the bank indicated in January that its 250-basis-point hike would be its last for the year, despite inflation now at roughly 65%. Consumer prices in the country of 85 million last month jumped 6.7% from December — their biggest monthly jump since August — according to the Turkish central bank's figures. This is a developing story and will be updated shortly.
Organizations: Turkish Locations: Turkey, Turkish
ANKARA, Turkey (AP) — The work to tame inflation in Turkey — namely through interest rate hikes — will continue “with determination,” the country’s new central bank chief said Thursday, offering some certainty about efforts to right the battered economy following his precedessor's surprise resignation. The duty of the central bank is to ensure and maintain price stability,” Karahan told reporters in Turkey’s capital, Ankara. Erdogan, who has previously fired central bank governors who spurned his unorthodox policies, appointed the new economic team after getting reelected in May. The Turkish central bank most recently raised its key interest rate by 2.5 percentage points in January, when inflation reached nearly 65%. Despite such hikes, inflation remains high — consumer prices rose to an eye-watering 64.86% in January from a year earlier, according to figures released Monday, up from 64.77% in December.
Persons: Fatih Karahan, Goldman Sachs, Karahan, Mehmet Simsek, ” Karahan, Hafize Gaye Erkan, , Erkan, Recep Tayyip Erdogan's, Erdogan, ___ Robert Badendieck Organizations: Finance, Turkish Locations: ANKARA, Turkey, Ankara, Turkish, Ukraine, Istanbul
Turkey's newly appointed central bank governor Fatih Karahan has his work cut out for him, named to the job by presidential decree over the weekend after the sudden resignation of his predecessor, Hafize Gaye Erkan. Previously the central bank's deputy governor, Karahan's resume features years spent in prominent American institutions and companies. Turkey's consumer price index print came out Monday showing a roughly 65% increase year-on-year for the month of January. Its central bank has made eight consecutive interest rate hikes since May 2023 — for a cumulative 3,650 basis points — in an effort to rein in soaring inflation. While painful for the country, investors and economists say the rate hikes have been necessary and that continuity in monetary policy priorities will engender confidence in the new central bank chief.
Persons: Turkey's, Fatih Karahan, Hafize Gaye Erkan, Karahan's, , Karahan Organizations: University of Pennsylvania, Federal Reserve Bank of New, Columbia University, New York University, Amazon, greenback Locations: Federal Reserve Bank of New York, Turkish
President of Turkey Recep Erdogan addresses journalists during the final national press conference during the high level NATO summit in Litexpo Conference Centre in Vilnius, Lithuania on July 12, 2023. Inflation in Turkey for the month of January saw its biggest monthly jump since August, rising 6.7% from the month prior, while year-on-year inflation hit nearly 65%, according to the Turkish Central Bank's figures released Monday. This is a breaking news story, please check back later for more.
Persons: Turkey Recep Erdogan Organizations: NATO, Conference Locations: Turkey, Vilnius, Lithuania, Turkish Central
Turkey central bank chief quits, citing need to protect her family
  + stars: | 2024-02-03 | by ( ) www.cnbc.com   time to read: +3 min
Turkish Central Bank Governor Hafize Gaye Erkan answers questions during a news conference for the Inflation Report 2023-III in Ankara, Turkey on July 27, 2023. Anadolu Agency | Anadolu Agency | Getty ImagesTurkey's central bank governor Hafize Gaye Erkan resigned on Friday, citing a need to protect her family amid a "reputation assassination", and she was swiftly replaced by a deputy who is expected to carry on her tight policy stance. The first woman to lead the central bank, Erkan was its fifth governor in as many years. Since then the central bank had hiked its key rate to 45% from 8.5%. Last month, opposition newspaper Sozcu published an article about a central bank employee who said she was wrongfully dismissed from the bank by Erkan's father.
Persons: Turkish Central Bank Governor Hafize Gaye Erkan, Hafize Gaye Erkan, Tayyip Erdogan, Erkan, Fatih Karahan, Erdogan, Sozcu, Erkan's Organizations: Turkish Central Bank Governor, Anadolu Agency, Getty, Official Gazette, Turks, Federal Reserve Bank of New Locations: Ankara, Turkey, Federal Reserve Bank of New York, U.S
Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailTurkey's rate hikes are 'absolutely a positive surprise,' economist saysArda Tunca, economist at PolitikYol, discusses the Turkish central bank's decision to hike interest rates by 500 basis points to 40%.
Persons: Arda Tunca Locations: Turkish
Turkey's central bank hikes key interest rate to 35%
  + stars: | 2023-10-26 | by ( Jenni Reid | ) www.cnbc.com   time to read: +1 min
Turkish Central Bank Governor Hafize Gaye Erkan answers questions during a news conference for the Inflation Report 2023-III in Ankara, Turkey on July 27, 2023. Turkey's central bank on Thursday hiked its key interest rate from 30% to 35%, in an ongoing bid to rein in inflation. The turnaround began in June, when Turkey's President Recep Tayyip Erdogan — who spearheaded the controversial policy stance — appointed former Wall Street banker Hafize Gaye Erkan as new central bank governor. The key interest rate has been hauled up from 8.5% since then, and economists argue it needs to go further. Inflation is forecast by the central bank to reach just over 60% by the end of 2023, while the Turkish lira has plummeted, making imports more expensive.
Persons: Turkish Central Bank Governor Hafize Gaye Erkan, Recep Tayyip Erdogan —, , Hafize Gaye Erkan Organizations: Turkish Central Bank Governor, Reuters, Wall Street Locations: Ankara, Turkey, Turkey's
Morning Bid: Haunted by 5% ahead of ECB, GDP and Amazon
  + stars: | 2023-10-26 | by ( ) www.reuters.com   time to read: +5 min
Traders work on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., October 23, 2023. With Amazon due to report later, there was no respite for the so-called 'Magnificent Seven' Wall St behemoths or the wider market ahead of Thursday's open. The bond market seemed unimpressed even as the U.S. House of Representatives ended a three week hiatus by electing Republican Mike Johnson, a conservative with little leadership experience, as speaker. European stocks (.STOXXE) and the euro dropped sharply, meantime, as regional banking shares were hit ahead of the European Central Bank's policy decision later in the day. Key developments that should provide more direction to U.S. markets later on Thursday:* European Central Bank policy decision and press conference.
Persons: Brendan McDermid, Mike Dolan, Israel, Republican Mike Johnson, Johnson, Joe Biden's, AO, Bunge, Northrop, Wang Yi, Antony Blinken, Emelia Sithole Organizations: New York Stock Exchange, REUTERS, Google, Big Tech, Nasdaq, Semiconductor, SOX, Bank of Japan, U.S . House, Republican, United Auto Workers, Ford, European, ECB, Chartered, BNP, Central Bank, Turkish Central Bank, Fed, Intel, UPS, Honeywell, Merck, Comcast, Mastercard, Capital, Energy, Mohawk, Eastman Chemical, Camden Property, AO Smith, Hasbro, Myers Squibb, Boston Scientific, Hershey, Northrop Grumman, Treasury, Foreign, U.S, Brussels Reuters Graphics Reuters, Reuters, Thomson Locations: New York City, U.S, Wall, Israel, Gaza, Philadelphia, Bank, Ukraine, China, Kansas, Bristol, Washington, Brussels
There's still a 'big fog' in the Turkish market, economist says
  + stars: | 2023-09-22 | by ( ) www.cnbc.com   time to read: 1 min
Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailThere's still a 'big fog' in the Turkish market, economist saysArda Tunca, economist at PolitikYol, discusses the Turkish central bank's decision to hike its key interest rate to 30%.
Persons: Arda Tunca Locations: Turkish
ISTANBUL (AP) — Turkey’s central bank raised its key interest rate by 5 percentage points Thursday, another large but expected hike that signals a continued push toward more traditional economic policies under President Recep Tayyip Erdogan. The Turkish central bank started cutting rates in late 2021 under pressure from Erdogan. Before their appointments, the central bank had cut its key interest rate from around 19% in 2021 to 8.5% earlier this year. Erdogan has fired three central bank governors who resisted pressure to cut rates before appointing Erkan’s predecessor in 2021. Following Erkan’s appointment, the bank has raised its key rate a series fo time: by an aggressive 7.5 percentage points in August, 2.5 percentage points in July and 6.5 percentage points in June.
Persons: Recep Tayyip Erdogan, Erdogan, Merrill Lynch, Mehmet Simsek, Hafize Gaye Erkan, Erkan’s Organizations: U.S . Federal Reserve, Bank of England, U.S Locations: ISTANBUL, Turkey, Turkish, Erdogan, Central, Ukraine
Dollar rises ahead of Jackson Hole gathering
  + stars: | 2023-08-24 | by ( Saqib Iqbal Ahmed | ) www.reuters.com   time to read: +4 min
"But the reaction to them was pretty muted overall, suggesting the Jackson Hole symposium is the main thing on the markets' mind," he said. Elsewhere, the Turkish lira rallied to a 2-month high against the dollar, up about 6% to 25.55 against the dollar after the Turkish central bank hiked the 1-week repo from 17.5% to a much-higher-than expected 25%. According to the median estimate in a Reuters poll, economists were expecting the policy rate to increase to 20%. Turkey's central bank embarked on a tightening cycle in June after President Tayyip Erdogan appointed former Wall Street banker Hafize Gaye Erkan as governor. The dollar was 0.7% higher against the yen , not far from the 9-month high 146.565 touched last week.
Persons: Dado Ruvic, Jerome Powell's, Jackson, Stuart Cole, Powell, Cole, Patrick Harker, Susan Collins, Tayyip Erdogan, Hafize Gaye Erkan, Piotr Matys, Saqib Iqbal Ahmed, Joice Alves, Tom Westbrook, Ankur Banerjee, Angus MacSwan, Andrea Ricci, Nick Zieminski Organizations: REUTERS, Jackson, Equiti, Federal Reserve, Philadelphia Fed, Boston Fed, U.S, Turkish, Wall Street, Touch Capital, Bank of England, Thomson Locations: London, Europe, Turkish, British
Dollar rises ahead of Jackson Hole, Turkish lira rallies
  + stars: | 2023-08-24 | by ( Joice Alves | ) www.reuters.com   time to read: +3 min
REUTERS/Dado Ruvic/Illustration/file photo Acquire Licensing RightsLONDON, Aug 24 (Reuters) - The dollar rose on Thursday as investors awaited for U.S. job data ahead of the Federal Reserve's Jackson Hole symposium, while the Turkish lira rallied after a larger-than-expected central bank rate hike. Investors were cautious after softer-than expected data in Europe and the U.S. muddied the economic outlook sending the safe-haven dollar higher. "As the Jackson Hole symposium gets under way, market participants are looking for direction," said Isabel Albarran, Investment Officer at Close Brothers Asset Management. MORE COULD COMEElsewhere, the Turkish lira rallied, up 3% to 26.4040 against the dollar after the Turkish Central Bank hiked the 1-week repo from 17.5% to a much-larger-than expected 25%. Turkey's central bank embarked on a tightening cycle in June after President Tayyip Erdogan appointed former Wall Street banker Hafize Gaye Erkan as governor.
Persons: Dado Ruvic, Jackson, Jerome Powell, Isabel Albarran, Tayyip Erdogan, Hafize Gaye Erkan, Piotr Matys, Moh Siong Sim, China's, Joice Alves, Tom Westbrook, Ankur Banerjee, Angus MacSwan Organizations: REUTERS, Federal, Turkish, U.S, Investors, Investment, Asset Management, Turkish Central Bank, Wall Street, Touch Capital, British, Bank of England, PMI, Singapore, Thomson Locations: Europe, London
VIEW Turkey cements policy shift with super-sized rate hike
  + stars: | 2023-08-24 | by ( ) www.reuters.com   time to read: +5 min
A logo of Turkey's Central Bank is pictured at the entrance of its headquarters in Ankara, Turkey October 15, 2021. "We should recall that sudden changes in interest rates usually have a delayed effect. "This was also the steepest rate hike since the CBT management reshuffle after the elections in May. We think the strong rate hike meant to address market concerns that the CBT wanted to avoid significant rate hike." TIMOTHY ASH, BLUEBAY ASSET MANAGEMENT, LONDON"Really solid move by the CBRT (central bank) to hike policy rates arguably above expectations by 750bps to 25%."
Persons: Cagla, GRZEGORZ DROZDZ, TIMOTHY ASH, 750bps, Hatice Karahan, Hatice Gaye, PIOTR MATYS, Governor Erkan, Erdogan, LIAM PEACH, Erkan, OZKARDESKAYA, SWISSQUOTE Organizations: Turkey's Central, REUTERS, Reuters, Thomson Locations: Ankara, Turkey, Turkish, EMERGINGMARKETWATCH.COM, SOFIA, GENEVA
Exterior of the Turkish Central Bank, known as Turkiye Cumhuriyet Merkez Bankasi in Ankara. In volatile trade after the announcement, the embattled Turkish lira gained ground against the U.S. dollar and euro. Ongoing firm inflation rates pushed the central bank to recently revise its inflation forecast for the year-end from 22.3% to 58%. On Thursday, the bank said it expected year-end inflation to sit in the "upper bound of the forecast range." The central bank on Thursday attributed the ongoing stickiness of national inflation to strong domestic demand, wage pressures, exchange rates, persistent services inflation and tax regulations.
Organizations: Turkish Central Bank, Reuters, Turkish, U.S . Locations: Ankara, Turkey's, London, Turkish
Turkey’s central bank raised interest rates to 25 percent from 17.5 percent on Thursday, a big jump that underscored a shift by the country’s president, Recep Tayyip Erdogan, toward a more orthodox monetary policy to control inflation that exceeded an annual rate of 80 percent last year. The size of the increase, which put the benchmark rate at its highest level since 2004, was bigger than expected, exceeding forecasts from financial analysts, who had predicted a more modest jump after July’s 2.5 percent rise. After the announcement, the Turkish lira quickly rallied, briefly rising more than 7 percent against the U.S. dollar. It was trading at 25.6 per dollar by early evening in Turkey. In a statement, the Turkish central bank said it had “decided to continue the monetary tightening process in order to establish the disinflation course as soon as possible, to anchor inflation expectations, and to control the deterioration in pricing behavior.”
Persons: Recep Tayyip Erdogan, Organizations: U.S . Locations: Turkish, Turkey
Turkish Central Bank Governor Hafize Gaye Erkan answers questions during a news conference for the Inflation Report 2023-III in Ankara, Turkey on July 27, 2023. Turkey's central bank expects inflation to hit 58% by the end of 2023, its new governor Hafize Gaye Erkan said in her debut news conference Thursday, as she committed to "restore anchoring of expectations as well as predictability." The new forecast is more than double the 22.3% outlined in the central bank's last inflation report three months ago. This expectation was met later in the month, when the central bank almost doubled its key interest rate from 8.5% to 15%, its first hike since March 2021. In her press conference Thursday, Erkan said food inflation is expected to top 60% at the end of the year.
Persons: Turkish Central Bank Governor Hafize Gaye Erkan, Hafize Gaye Erkan, Erkan Organizations: Turkish Central Bank Governor Locations: Ankara, Turkey, Turkey's
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Persons: Dow Jones
With the use of central bank reserves to protect the lira’s value before the election, reserves fell to a historical low in early June, with net reserves at minus $5.7 billion. Hence, there is no use of foreign exchange reserves and a period of increasing reserves has started," he added. His comments echoed the view of bankers that the central bank had "completely stopped" using its reserves. CENTRAL BANK MEASURESUnder new central bank steps announced at the weekend, the securities maintenance ratio that banks are required to allocate to their foreign currency deposit was reduced to 5% from 10%. The new regulation said banks whose lira deposits are less than 57% of total deposits will have to hold an additional seven percentage points of securities, compared to the previous seven additional points applied to banks that held less than 60% lira deposits.
Persons: Murad Sezer, Lira, Tayyip Erdogan, Hafize Gaye Erkan, Enver Erkan, Daren Butler, Canan, Jonathan Spicer, Emelia Sithole Organizations: REUTERS, Securities, Bankers, Thomson Locations: Istanbul, Turkey, ANKARA, backtrack, Turkish
ANKARA, June 25 (Reuters) - Turkey's central bank took fresh steps on Sunday in line with its goals to increase functionality of market mechanisms, after it hiked rates to 15% from 8.5% this week. Turkey's securities maintenance regulation has been simplified to increase the functionality of market mechanisms and strengthen macro financial stability, the Turkish central bank said on Sunday. In a statement after the committee meeting, the bank said it would simplify and improve the existing micro- and macroprudential framework to increase the functionality of market mechanisms and strengthen macro financial stability. With the new regulation, securities that banks must maintain ranged between 3% and 12% of their lira deposits. Previously the requirement of seven additional points applied to banks which held less than 60% lira deposits.
Persons: Nevzat Devranoglu, Huseyin Hayatsever, Daniel Wallis Organizations: Gazette, Thomson Locations: ANKARA, Turkish
Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailSteve Hanke says Turkey's central bank still has a lot of work to do, 'to put it mildly'Steve Hanke, professor of applied economics at Johns Hopkins University, says the Turkish central bank's decision to hike interest rates by 650 basis points to 15% is "behind the curve."
Persons: Steve Hanke Organizations: Johns Hopkins University Locations: Turkish
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Persons: Dow Jones, erdogan, 8f3865
But the level remains uncertain as the central bank has not given any signals as to its next steps, including the size or pace of potential hikes. Some economists have expressed doubt about Erdogan's commitment to abandoning his unorthodox policy of low rates, which led the central bank to slash its policy rate from 19% in 2021 to 8.5% currently. The median estimate for the policy rate at end-2023 was 30%, with forecasts ranging from 18% to 35%. He named Naci Agbal as central bank governor in Nov. 2020 but, after some sharp rate hikes, replaced him less than five months later. The central bank is scheduled to announce its rate decision at 1100 GMT on Thursday.
Persons: Murad Sezer, Tayyip Erdogan, Hafize Gaye Erkan, Malek Drimal, Erdogan, Mehmet Simsek, Moody's, Naci, Simsek, Ali Kucukgocmen, Marc Jones, Jonathan Spicer, Daren Butler, Christina Fincher Organizations: REUTERS, Societe Generale, stoke, Thomson Locations: Istanbul, Turkey, ISTANBUL
Exterior of the Turkish Central Bank, known as Turkiye Cumhuriyet Merkez Bankasi in Ankara. Turkey's President Recep Tayyip Erdogan has appointed a former Wall Street banker Hafize Gaye Erkan as the country's new central bank governor — another move that could potentially mark a policy pivot away from economic unorthodoxy. Erkan, Turkey's first female central bank chief, was a former managing director at Goldman Sachs and co-CEO at First Republic Bank. She is also Turkey's fifth central bank governor in four years. The caveat would lie in how much autonomy the central bank could exercise, and to what extent —something that Demiralp says investors will have to wait and see.
Persons: Recep Tayyip Erdogan, Hafize Gaye Erkan, , Turkey's, Goldman Sachs, Mehmet Simsek's, Selva Demiralp, Demiralp Organizations: Turkish Central Bank, Wall Street, First Republic Bank, Princeton, Koç University, CNBC Locations: Ankara, U.S, Istanbul
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