The economic world has its eyes on the Central Bank's interest rate decision!

The Central Bank of the Republic of Türkiye (CBRT) will announce its September interest rate decision at the Monetary Policy Committee (MPC) meeting at 14:00.

In the previous meeting, the bank had raised the policy rate by 750 basis points to the 25 percent level.

The market will closely follow the messages regarding inflation developments and monetary policy, in addition to the interest rate decision.

WHAT IS THE INTEREST RATE EXPECTATION?

The Central Bank's total interest rate hike over the last three months has reached 16.5 points. So, what will the Central Bank's September interest rate decision be?

While all 16 economists participating in the Reuters survey expect an increase in the policy rate, which is at the 25 percent level, forecasts range between 27.5 percent and 31 percent.

In the survey, two economists expect a 600 basis point increase, nine economists expect a 500 basis point increase, one economist expects a 400 basis point increase, and two economists expect a 250 basis point increase.

The average expectation in the survey is for the interest rate to be raised to 30 percent.

500 BASIS POINT INCREASE FORECAST

The AA Finance expectation survey for the CBRT Monetary Policy Committee (MPC) meeting to be held on Thursday, September 21, was concluded with the participation of 19 economists.

The median of the economists' expectations regarding the change in the policy rate was a 500 basis point increase.

According to the survey results, the policy rate expectations of economists who foresee an increase between 250 and 600 basis points range from 27.50 percent to 31.00 percent, while year-end policy rate expectations range between 35 and 45 percent.

All 24 economists participating in the Foreks Haber survey predicted that the interest rate would be increased. While the highest forecast was 31.00 percent, the lowest forecast was 27.50 percent. The median expectation in the survey was that the interest rate would be increased by 500 basis points this week.

In the survey, the median interest rate forecast of 22 economists who provided opinions for the end of 2023 was 35.00 percent. The maximum expectation for year-end interest rate forecasts was 45.00 percent, and the minimum expectation was 30.00 percent. In last month's survey, the median forecast was at the 25.00 percent level, and the forecast range was between 30.00 percent and 20.00 percent.

BLOOMBERG SURVEY

The average expectation of economists participating in the survey by the US-based financial agency Bloomberg regarding this week's interest rate decision was for a 500 basis point increase.

BARCLAYS FORECAST

The British bank Barclays, contrary to general market expectations, expects a limited 250 basis point interest rate hike from the CBRT this week. Barclays analysts stated that although they do not rule out a much sharper move, they expect "gradual increases" following the above-expectation interest rate hike carried out in August.

JPMORGAN FORECAST

The US investment bank JPMorgan announced that it expects a 500 basis point interest rate hike from the CBRT in each of the monetary policy committee meetings in September and October.

STANDARD CHARTERED FORECAST

Predicting that the CBRT will continue to focus on rapidly rising inflation and increasing external imbalances in the short term, the British bank Standard Chartered reported that they expect the CBRT to increase the policy rate by 500 basis points at the September 21 meeting.

HSBC FORECAST

HSBC raised its year-end forecast for the policy rate in Türkiye from 30 percent to 32.5 percent. The bank kept its 2023 growth expectation at 4.4 percent.

CBRT EXPECTATION SURVEY

In the CBRT's market survey, the participants' expectation for the overnight interest rate formed in the BIST Repo and Reverse-Repo Market at the end of the current month was 19.34 percent in the previous survey period, while it was 29.26 percent in the September survey. The CBRT one-week mat