Global Economy
Turkey Central Bank Cuts Policy Rate to 37% in First 2026 Meeting – Lowest Since Nov 2023
The Central Bank of the Republic of Turkey lowered its policy rate by a full percentage point to 37% during its first monetary‑policy meeting of 2026. While the cut fell short of median market expectations of a 1.5‑point reduction, it marks the lowest rate since November 2023. The bank cited a slowing underlying inflation trend at the end of 2023, despite overall price pressures from food, as justification for a modest easing. Officials warned that inflationary risks remain, with price volatility and high inflation expectations still challenging the disinflation path.
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Thursday, 22 January 2026
The Central Bank of the Republic of Turkey announced a 100‑basis‑point reduction in its policy rate, bringing it down to 37% at its first monetary‑policy meeting of 2026.
Market participants had been expecting a larger cut – the median forecast was a 1.5‑point decrease – but the new rate is still the lowest recorded since November 2023.
Monetary policy outlook
The central bank said that the underlying inflation trend had slowed toward the end of 2023, even though headline inflation remained elevated because of higher food prices. This moderation allowed the bank to implement a modest easing of its stance.
Nevertheless, policymakers cautioned that inflationary pressures could rise again. Persistent price volatility and elevated inflation expectations continue to pose risks to the disinflation process.