Commerzbank expects CBRT interest rate cut on October 22

Following the September inflation data announced in Turkey, German bank Commerzbank shared its new forecast regarding the interest rate policy of the Central Bank of the Republic of Turkey. Following the decline in inflation, the bank expects an interest rate cut at the October 22 meeting.

September Inflation Data

It was announced that Turkey's annual inflation, which was at 31.5 percent in August, dropped to 29.7 percent in September. This development was closely monitored by economic circles.

Commerzbank's Interest Rate Expectation

Commerzbank Analyst Tatha Ghose described the decline in inflation in September as a favorable basis for the CBRT to cut interest rates in October. The bank forecasts a 100 basis point cut at the October 22 meeting.

Effects on the Turkish Lira

In Commerzbank's assessment, it was pointed out that the interest rate cut decision could put pressure on the Turkish lira. Despite potential interventions to support the exchange rate, the risk of depreciation in the TL remains.