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JP Morgan, in a published research report, stated that they do not expect a change in interest rates until September and that they expect a 100 basis point cut in September.
Noting that there is not much room for policy changes given high inflation, the need for external financing and global financial conditions, the institution affirmed that the commitment of the new central bank president to reduce inflation, transparency and predictability is soothing.
Stating that the need for external financing is increasing and capital flows against emerging markets are less favorable, the bank said this could increase the potential vulnerability of Turkish assets.
JP Morgan stated that they have not changed their forecasts for the time being and said they will await guidance and data from the CBRT.
Kavcıoğlu appointed to replace Ağbal on CBRT
While Naci Ağbal was dismissed by the presidential decree published in the Official Gazette in the early hours of Saturday, Şahap Kavcıoğlu was appointed director of the CBRT.
In his first statement, the new president of the CBRT, Şahap Kavcıoğlu, emphasized the objective of achieving a permanent decrease in inflation.
Kavcıoğlu used the following statements in his statement:
Central Bank of the Republic of Turkey, duties and powers within the framework established by the Law in line with the fundamental objective of achieving a lasting fall in inflation will continue to use monetary policy tools effectively.
Although the fall in inflation will positively affect macroeconomic stability through the reduction of country risk premiums and the permanent improvement of financing costs, it will also contribute to the creation of the necessary conditions for a sustainable growth that increases investment. , production, exports and employment.
In this context, the meetings of the Monetary Policy Committee will be held in accordance with the schedule previously announced to the public, and the communication channels with all stakeholders will be used effectively in line with the principles of transparency and predictability. in the policies to be implemented.
Kavcıoğlu met with bankers
Naci Ağbal the presidential decree of the Central Bank of the Republic of Turkey after taking office appointed President of Kavcioglu Shihab, the Turkish Banking Association (TBB) held a meeting with the general manager of the bank in the Board of Directors.
According to information Bloomberg HT obtained from leading bankers, CBRT chairman Kavcıoğlu delivered critical messages at the meeting with the bank’s general managers. At the meeting it emerged that Kavcıoğlu stressed that the main priority of the Central Bank will continue to be the fight against inflation.
The other main message that Kavcıoğlu gave at the meeting was the emphasis that there will be no change in Central Bank policies in the new period. At the meeting, messages were released that there will be no off-calendar monetary policy committee meeting.
TÜSİAD Chief Economist Gizem Öztok Altınsaç
“I think we are not in a period where we can make predictions about policy. Instead of an early rate cut, there will be no interest rate cuts with an interim meeting until April 15. But this is not the problem. probably in a disrupted situation in the fight against inflation If we want an investment environment, some important institutions must regain their policymaking capacity.
We have left behind 4 months trying to earn this. We see that our CBRT chair changes quite frequently. Similarly, the heads of TURKSTAT are changing. These reduce the predictability and policymaking capacity of institutions. In such a situation, it is not possible for the country to achieve long-term growth.
It is simply not unique to Turkey. When we look at the exchange rate reaction on Sunday, we see that the volume of transactions is approaching $ 1.4 billion. It would normally be a volume of 150 million dollars a night. There is almost 10 times the volume of that. A volatile period awaits us. We are moving into a very unfamiliar environment. At a time when we are trying to gain credibility for TL. The price has already revealed the situation. I don’t expect this price to calm down in the short term.
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