Why was the minimum wage announced in such a rush? Experts explain
Following the announcement of the minimum wage last night, experts pointed to the Central Bank's interest rate decision. The fact that the minimum wage increase was limited to 30 percent has confirmed that the Central Bank will begin cutting interest rates.
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Minister of Labor and Social Security Vedat Işıkhan had announced earlier this week that the minimum wage would be declared on Thursday or Friday.
However, in a meeting yesterday evening that Türk-İş did not attend, Minister Işıkhan stated that the minimum wage to be applied in 2025 would be 22,104 liras.
'IT HAS BECOME CERTAIN THAT INTEREST RATE CUTS WILL BEGIN'
Sharing his views on his social media account after the minimum wage was determined in a rush, former Central Bank Chief Economist Hakan Kara said, "The fact that the minimum wage increase was limited to 30 percent has solidified that the Central Bank will begin interest rate cuts. Tomorrow, the stock market index will rise and bond yields will fall."
'THEY ARE CONDUCTING A DAWN RAID'
Financial Markets Expert İris Cibre, who shared her views on her social media account, stated that the meeting was moved forward due to the Central Bank's upcoming interest rate decision, noting, "Işıkhan said we would convene the commission on Thursday or Friday; just 24 hours ago, someone reminded them, 'Hey, there is an MPC meeting, they are going to make a decision,' and now they are conducting a dawn raid," she remarked.
'READ AS STRENGTHENING THE CENTRAL BANK'S HAND'
Economist Barış Soydan provided the following remarks on the subject:
"The stock market interpreted the minimum wage hike being limited to 30 percent as strengthening the Central Bank's hand for interest rate cuts, and the rise led by the financial sector reached 2 percent. Tomorrow's interest rate decision and the roadmap the Central Bank will outline for the coming period will determine the direction of the stock market."
150 BASIS POINT INTEREST RATE CUT EXPECTED
On the other hand, according to the results of the market participants survey for December, which was answered by 69 participants consisting of representatives from the real and financial sectors prior to the Central Bank's interest rate decision, a 150 basis point interest rate cut is expected.
