Monetary Policy Statement from CBRT Governor Fatih Karahan at the Parliamentary Commission

Central Bank of the Republic of Turkey Governor Fatih Karahan announced during his presentation at the Grand National Assembly of Turkey (TBMM) Planning and Budget Commission that outflows from money market funds have largely shifted towards deposits. Karahan emphasized that the tight monetary policy stance will be resolutely maintained until price stability is achieved.

Commission Presentation and Monetary Policy

Central Bank of the Republic of Turkey Governor Fatih Karahan delivered a presentation to members of parliament at the TBMM Planning and Budget Commission regarding global developments, the Turkish economy, inflation, and the monetary policy framework.

Speaking at the committee convened under the chairmanship of Commission Chairman and AK Party Samsun Deputy Mehmet Muş, Karahan stated that the tight monetary policy stance will be resolutely maintained until price stability is established.

Fund Outflows and Deposit Tendency

Stating that there have been recent outflows from money market and similar funds, Karahan noted that these outflows have largely shifted towards deposits.

Emphasizing that when they examine the tendency towards deposits in terms of currency composition, the preference for TRY is consistent with the current TRY share, Karahan reported that within this scope, the TRY share—both including and excluding investment funds—continues to remain at the 61 percent level.

Inflation Course and Disinflation Process

Recalling that an increase was observed in the main trend of inflation during the March-June period when the effects of the war became pronounced, Karahan stated that a decline in the main trend has been recorded once again starting from July.

Anticipating that the disinflation process will regain momentum with the contribution of the tight monetary policy as the impact of shocks eases, Karahan expressed that inflation expectations and pricing behaviors will be of critical importance for the course of disinflation in the upcoming period.

September Inflation Data

Conveying that annual consumer inflation materialized at the 29.7 percent level as of September, Karahan noted that the main trend, which had risen to the 30 percent levels during the war period, points to the 23.7 percent level as of September.

The Central Bank Governor underscored that they will continue to use all available tools resolutely until the price stability target is achieved.