300 basis point cut from the Central Bank: İnan Mutlu criticizes lack of direction in the economy

The Central Bank of the Republic of Turkey (TCMB) has cut its policy rate by 300 basis points, lowering it from 46 percent to 43 percent. While the decision came as a surprise to the markets, it drew a notable assessment from economist İnan Mutlu.

Reminding that Turkey has had the second-highest policy rate in the world since May 2024, Mutlu stated, "Despite this, while inflation was at 38 percent two years ago, it is at the 35 percent level today. In other words, despite the aggressiveness in interest rate policy, there is no meaningful gain."

Arguing that there is no solid economic program behind the decisions taken, Mutlu said, "Every interest rate step becomes new proof that there is no functioning program in place. It gives the impression of aimless moves intended to save the day."

The Central Bank has cut the policy rate from 46 percent to 43 percent with a 300 basis point reduction.

We continue to be the country with the second-highest policy rate in the world since May 2024.

Despite this, inflation, which was at 38 percent two years ago, is at 35 percent.

Every... pic.twitter.com/H6KE5p0oTq

— inan mutlu (@inanmutlu1) July 24, 2025

According to experts, the fact that inflation is not falling despite the interest rate cut shows that the economic management is facing a crisis of confidence. Market actors are now closely following the Central Bank's next steps.

News Source: 12punto