Following the TCMB’s interest rate decision, the BIST 100 index rose to nearly 2 percent, while the banking index led the increase after Turkey’s 5-year credit risk premium (CDS) fell to its lowest levels in the last 4 years.

The Central Bank of the Republic of Turkey (TCMB) Monetary Policy Committee (PPK) kept the policy rate, the one-week repo auction interest rate, unchanged at 50 percent.

The Central Bank left the policy rate unchanged at 50 percent

The PPK announcement included the following statements: “While core goods inflation continues to trend low with a limited increase, improvement in services inflation is expected to occur in the last quarter. In the event of a significant and permanent deterioration in inflation, monetary policy tools will be used effectively.”

Following the decision, the BIST 100 index rose to nearly 2 percent, while the increase in the banking index drew attention. The BIST 100 index on Borsa Istanbul, which rose to 9,980.81 points, is currently at 9,956 points with a 1.9 percent increase.

While all sector indices increased, the banking index, which gained 3 percent, is the index that gained the most among the sector indices. Behind the banking index, real estate investment trust gained 2.2 percent, transportation 1.9 percent, informatics approximately 2 percent, and holding 1.9 percent.

Following the decision, the dollar/TL decreased by 0.2 percent to 34.0130, the euro/TL increased by 0.4 percent to 38.0590, and the pound/TL increased by 0.2 percent to 45.1940.

Turkey's 5-year credit risk premium (CDS) approached the lowest level since February 2020 with 256.5 basis points.

Analysts noted that the signals received from the CBRT's decision text were interpreted as the fight against inflation will continue seriously, and stated that this situation could support the demand for Turkish lira assets. ✒️Ekotürk