Turkey makes 9th rate cut

May 22 2020

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ANKARA: The Turkish central bank on Thursday trimmed its main interest rate again by half a percentage point to 8.25 per cent after the recent rally in the lira.

The one-week repo auction rate was trimmed by 50 basis points, it said, marking the ninth consecutive cut and in line with the Bloomberg consensus.

The lira has been gaining value against the US dollar after reaching a record low earlier this month following the announcement by the bank that Qatar and Turkey had extended a 2018 swap amendment agreement.

The overall limit was increased from $5 billion equivalent of Turkish lira and Qatari riyal to $15bn, it said on Wednesday.

The move will be welcome for the economy now at risk of recession because of the coronavirus pandemic, although Ankara is seeking further swap agreements with the US Federal Reserve and other foreign central banks.

Published in Dawn, May 22nd, 2020