In a move set to frustrate Turkey’s leaders further, the country’s central bank decided Tuesday not to hold an heavily anticipated emergency rate-setting meeting after new data showed the country’s inflation fell by less than one percent last month.
According to the official Turkish statistics agency, annual inflation for the month of January fell to 7.24 percent from 8.17 percent in December — still higher than analysts had expected, but not enough to trigger an emergency monetary policy meeting on Wednesday .
The Turkish Lira, which was trading near record lows against the US dollar, gained strength in reaction to the figures.
Turkish central bank governor Erdem Basci earlier explained an extraordinary meeting was on the cards should the decline exceed one percentage point. Inflation has consistently come in above the bank’s official target of five percent in recent months, resulting in speculation that a rate cut was premature.
“Inflation indicators continue to improve in recent months owing to the implementation of cautious monetary and liquidity policies,” the central bank said in a statement Tuesday.
Nonetheless the meeting, which will now take place as scheduled on February 24, comes at a time of tensions ahead of parliamentary elections in June with concerns about the central bank’s independence. President Recep Tayyip Erdogan, long a vocal critic of the bank’s policies, reaffirmed his frustrations over the weekend.
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