Barclays' Year-End Interest Rate Assessment Following CBRT Decision

Following the decision of the Central Bank of the Republic of Turkey to keep the policy rate steady at 37 percent, Barclays maintained its year-end expectation unchanged at 35 percent in the report it published.

Interest Rate Decision and Alignment with Expectations

Barclays published an evaluation report following the Monetary Policy Committee decision in which the Central Bank of the Republic of Turkey kept the policy rate steady at 37 percent. The bank emphasized that this decision was fully aligned with its own projections and consensus expectations.

Year-End Rate Cut Projections

In the report prepared by Senior Economist Ercan Ergüzel, it was stated that the CBRT maintained its cautious stance. The policy rate is expected to be reduced to 35 percent with 100 basis point cuts in each of the last two meetings of the year.

Key Changes in the Text

Three main changes stood out in the CBRT decision text compared to the previous communication. These changes were listed in the report as the disinflation momentum, the weakness in domestic demand, and the risk of energy prices.

Future Period Forecasts

The bank's inflation expectation for 2026 was announced as 30 percent, and its policy rate expectation as 35 percent. For 2027, the inflation expectation was set at 23.1 percent and the policy rate forecast at 29 percent.