ITO President Avdagiç: Interest rate hikes are the most powerful weapon against disinflation

Istanbul Chamber of Commerce (ITO) President Şekib Avdagiç shared his assessments regarding the business world and the Inflation Report presentation meeting during the February meeting. Avdagiç pointed out that unless the tightness in monetary policy is supported by fiscal policy, the anti-inflation program may remain limited.

Wishing success to Fatih Karahan, who was appointed as the Governor of the Central Bank of the Republic of Turkey (TCMB), Avdagiç said, "We believe that under Mr. Karahan's leadership, the Central Bank will provide lasting gains for our country and our business world. The leadership transition process at the Central Bank was managed with correct communication that did not give rise to any misunderstandings. The declarations of determination that the change in governor is not related to a change in policy have given confidence to the markets." 

"INTEREST RATE HIKE IS THE MOST EFFECTIVE WEAPON"

Avdagiç stated, "An interest rate hike is the most effective weapon in the disinflation process, but it is not the only one. Unless the tightness in monetary policy is supported by fiscal policy, the anti-inflation program may remain limited. For this reason, importance must be given to the harmony between monetary and fiscal policy and to the structural reforms that will support this harmony."