BofA and Morgan Stanley expect the Central Bank of the Republic of Turkey (TCMB) to make a radical interest rate decision


Two leading banks of America, BofA and Morgan Stanley, announced that they expect a radical decision to be made by the Central Bank of Turkey (TCMB) in this week’s interest rate meeting.

While BofA stated that they expect the Central Bank of Turkey (TCMB) to raise the policy interest rate to 25 percent in this week’s meeting, Morgan Stanley stated that they anticipate a decision within the range of 20 percent.

In the published report, BofA economists noted that a lower-than-expected interest rate increase could be supported by signaling a narrower interest rate corridor or signaling further interest rate hikes. The report also stated that the gradual removal of regulations and controls is expected, and it was evaluated as “We see a large interest rate hike in a single move to lift controls as less likely.

Morgan Stanley economists, in their communicated note, expressed that they do not expect a rapid attainment of levels indicating positive real interest rates. They stated, “We believe the initial steps will aim to narrow the significant gap between the policy rate and inflation expectations.

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