ANKARA: Turkiye central bank Governor Hafize Gaye Erkan said at an investor meeting late last week that the bank is vigilant on inflation risks and ready to take any necessary action if needed, bankers said.
According to participants at the investor meeting, held in the United States at the end of last week, Erkan said monetary tightness will be maintained as long as needed to ensure sustained price stability.
Assessing that monetary tightness is significantly close to the level required to establish the disinflation course, the bank reduced the pace of monetary tightening in December, she was cited as saying.
“We anticipate the completion of the tightening cycle as soon as possible,” she also said. The central bank declined to comment on Erkan’s remarks.
Turkiye central bank total reserves hit record high of $140bn
The bank lifted its key interest rate by 250 basis points to 42.5% on Dec. 21 as it continued to battle against years of soaring inflation, which stood at 64.77% annually in December and is expected to peak around 70-75% in May before falling.
The bank has raised its one-week repo rate by 3,400 basis points since June, when President Tayyip Erdogan appointed former Wall Street banker Erkan as its governor to conduct a sharp pivot toward more orthodox policies.
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