Turkey Central Bank Survey Points at Another Rate Cut This Month

(Bloomberg) -- Participants in the Turkish central bank’s monthly survey expect another reduction in the benchmark interest rate this month, followed by a pause. 

Turkey will slash its key rate by 100 basis points to 15% on Thursday, according to the survey of 48 people, mostly finance and corporate sector representatives. That matched the median estimate in a Bloomberg poll. However, participants in the central bank study see the rate unchanged at 15% three months later. 

The year-end inflation expectations of the participants climbed to 19.31% from 17.63% in October’s poll. The lira was seen weakening to 9.98 per dollar by the end of the year.

The central bank has cut its benchmark rate by a total of three percentage points in September and October, triggering a rout in the lira. The currency weakened more than 10% against the dollar this quarter, the worst among all major currencies tracked by Bloomberg. 

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