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Turkey’s Central Bank raises year-end inflation forecast to 58%

Turkey’s new Central Bank Governor Gaye Erkan reiterated the bank’s commitment to tighter monetary policy, but maintained that the shift would be gradual.
ADEM ALTAN/AFP via Getty Images

ANKARA — Turkey's Central Bank increased its year-end annual inflation projection by more than 50%, the bank’s new governor, Hafize Gaye Erkan, said on Thursday.

Speaking at her first press conference after taking office in June, Erkan revised the bank’s year-end annual inflation projection to 58%. The previous forecast stood at 22.3%. Turkey’s first-ever female governor also reiterated the bank’s pledge to continue monetary-tightening policies. 

After Erkan’s appointment in early June, the Central Bank abandoned its unorthodox monetary policy of keeping interest rates low. 

Under Erkan’s leadership, the bank hiked the country’s policy rates by 900 basis points in successive rate hikes in June and July. However, the hikes fell below market expectations that were waiting for more drastic raises. 

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