CBRT releases real effective exchange rate index: It rose in February

The Central Bank of the Republic of Turkey (CBRT) has released the real effective exchange rate data for February. Accordingly, the CPI-based real effective exchange rate was 58.55. The January real effective exchange rate index was revised from 56.95 to 57.12.

The PPI-based exchange rate index rose to 89.12 during this period. The index was 87.20 in the previous month.

The nominal effective exchange rate is calculated using the average value of the Turkish Lira, weighted by bilateral trade flows, against a basket of currencies of countries that have a significant share in Turkey's foreign trade. The real effective exchange rate (REER) is reached by removing relative price effects from the nominal effective exchange rate.

REER creates three different sub-indices by being adjusted with one of the following: CPI, PPI, or unit labor costs. Within the scope of its inflation target, the CBRT takes the CPI-based REER as the basis.