The Turkish Statistical Institute (TÜİK) and ENAG released their February inflation data yesterday. According to TÜİK, February inflation was recorded at 4.53 percent, while ENAG had announced inflation at 4.32 percent.
Following the higher-than-expected inflation data in Turkey, US investment bank JPMorgan revised its interest rate forecast for the Turkish economy.
JPMorgan expects a 500 basis point interest rate hike at the Central Bank meeting in April. If raised by 500 basis points, the interest rate will reach 50 percent. The US investment bank had previously held the view that Turkey had reached the end of its rate hike cycle, which had most recently been raised to 45 percent.
In JPMorgan's research note, it was stated that "Headline CPI inflation came in at 4.5 percent month-on-month in February, well above our expectation of 4.2 percent and the market consensus of 3.8 percent."
The bank announced that it expects the Central Bank of the Republic of Turkey (TCMB) could cut the policy rate in November and December, and therefore it is maintaining its year-end policy rate forecast at 45 percent.
News Source: 12punto
