{"id":405133,"date":"2026-04-22T13:02:41","date_gmt":"2026-04-22T13:02:41","guid":{"rendered":"https:\/\/www.newsbeep.com\/il\/405133\/"},"modified":"2026-04-22T13:02:41","modified_gmt":"2026-04-22T13:02:41","slug":"turkish-central-bank-holds-rate-at-37-raises-caution-over-inflationary-risks","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/il\/405133\/","title":{"rendered":"Turkish central bank holds rate at 37%, raises caution over inflationary risks"},"content":{"rendered":"<p>The headquarters of the Central Bank of the Republic of T\u00fcrkiye (CBRT) in Ankara, T\u00fcrkiye. (Adobe Stock Photo)<\/p>\n<p>\nApril 22, 2026 02:00 PM GMT+03:00\n<\/p>\n<p>The Central Bank of the Republic of T\u00fcrkiye (CBRT) kept its policy rate steady at 37% on Wednesday, citing ongoing upside risks to the disinflation process, largely driven by rising energy costs amid the Iran war.<\/p>\n<p>The overnight lending rate, which the central bank has used as its funding channel since the start of the Iran conflict, was held at 40%.<\/p>\n<p>More to Read<\/p>\n<p><a href=\"https:\/\/www.turkiyetoday.com\/business\/turkiyes-disinflation-program-has-collapsed-pro-govt-daily-targets-finance-minister-s-3218470\" title=\"\" t=\"\" disinflation=\"\" program=\"\" has=\"\" collapsed=\"\" pro-gov=\"\" daily=\"\" targets=\"\" finance=\"\" minister=\"\" simsek=\"\" rel=\"nofollow noopener\" target=\"_blank\"><img decoding=\"async\" src=\"https:\/\/www.newsbeep.com\/il\/wp-content\/uploads\/2026\/04\/turkiyes-disinflation-program-has-collapsed-pro-govt-daily-targets-simsek-3218470_20260420151938.jpg\" class=\"lazy\" loading=\"lazy\" alt=\"\" t=\"\" disinflation=\"\" program=\"\" has=\"\" collapsed=\"\" pro-gov=\"\" daily=\"\" targets=\"\" finance=\"\" minister=\"\" simsek=\"\"\/><\/a><\/p>\n<p>Easing trend continues, but risks to inflation remain<\/p>\n<p>In a statement following the year\u2019s third Monetary Policy Committee (MPC) meeting\u2014also the first since former Deputy Governor Cevdet Akcay <a href=\"https:\/\/www.turkiyetoday.com\/business\/inflation-could-hit-200-without-orthodox-shift-cbrts-akcay-says-in-farewell-3217211?s=2\" rel=\"nofollow noopener\" target=\"_blank\">stepped down due to retirement<\/a>\u2014the central bank said the underlying trend in inflation eased in March, but early indicators point to a slight uptick in April, with energy prices remaining elevated and volatile due to geopolitical developments.<\/p>\n<p>These factors could feed into inflation through cost channels, even as economic activity shows signs of slowing, the bank warned, flagging risks of knock-on effects that could push prices higher again.<\/p>\n<p>The bank reiterated that tight monetary policy will remain in place until price stability is achieved, supporting disinflation through demand, exchange rate and expectations channels. &#8220;The Committee reiterated that it remains highly attentive to upside risks on inflation,&#8221; <a href=\"https:\/\/www.tcmb.gov.tr\/wps\/wcm\/connect\/EN\/TCMB+EN\/Main+Menu\/Announcements\/Press+Releases\/2026\/ANO2026-17\" rel=\"nofollow noopener\" target=\"_blank\">the statement emphasized.<\/a><\/p>\n<p>&#8220;In case of a significant and persistent deterioration in the inflation outlook\u2026 monetary policy stance will be tightened.&#8221;<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"newspicture\" style=\"aspect-ratio:1280\/987;\" src=\"https:\/\/www.newsbeep.com\/il\/wp-content\/uploads\/2026\/04\/turkish-central-bank-holds-rate-at-37-raises-caution-over-inflationary-risks-3218595_202604221439_20.png\" alt=\"Line chart shows annual inflation and policy rates from May 2024 to March 2026. (Chart by Onur Erdogan\/T\u00fcrkiye Today)\" width=\"1280\" height=\"987\" data-width=\"1280\" data-height=\"987\" meta-alt=\"Line chart shows annual inflation and policy rates from May 2024 to March 2026. (Chart by Onur Erdogan\/T\u00fcrkiye Today)\"\/><br \/>\n<img decoding=\"async\" src=\"https:\/\/www.turkiyetoday.com\/s\/i\/i-fotobuyut.svg\"\/><\/p>\n<p>\nLine chart shows annual inflation and policy rates from May 2024 to March 2026. (Chart by Onur Erdogan\/T\u00fcrkiye Today)\n<\/p>\n<p>Market calm returns after early volatility<\/p>\n<p>The decision mirrors the previous meeting in March, when tensions in the Iran conflict were at their peak.<\/p>\n<p>Since the start of the conflict, policymakers have intervened in the market to defend the Turkish lira against volatility, offloading <a href=\"https:\/\/www.turkiyetoday.com\/business\/cost-of-iran-war-climbs-to-56b-for-turkiyes-central-bank-3217351?s=1\" rel=\"nofollow noopener\" target=\"_blank\">nearly $60 billion <\/a>from reserves at the peak to limit currency fluctuations.<\/p>\n<p>The bank also partially sold its gold reserves and <a href=\"https:\/\/www.turkiyetoday.com\/business\/turkiyes-central-bank-opens-5b-dollar-for-lira-swap-to-mitigate-liquidity-risks-amid-3217206\" rel=\"nofollow noopener\" target=\"_blank\">resumed dollar-for-lira<\/a> and dollar-for-gold swap transactions to offset losses in liquid foreign reserves.<\/p>\n<p>The decision to hold rates<a href=\"https:\/\/www.turkiyetoday.com\/business\/turkish-central-bank-poised-to-keep-rates-at-37-at-april-meeting-surveys-3218380\" rel=\"nofollow noopener\" target=\"_blank\"> broadly aligns with market expectations<\/a>, although a notable share of economists had expected a 300-basis-point hike, as a ceasefire between the U.S. and Iran reached in early April eased capital outflows and foreign currency demand, allowing the bank to recover some of its losses.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"newspicture\" style=\"aspect-ratio:1280\/960;\" src=\"https:\/\/www.newsbeep.com\/il\/wp-content\/uploads\/2026\/04\/turkish-central-bank-holds-rate-at-37-raises-caution-over-inflationary-risks-3218595_202604221439_20.jpeg\" alt=\"Chart shows the Central Bank of the Republic of T\u00fcrkiye\u2019s total reserves, broken down into gold and foreign exchange, from January 2023 to April 2026. (Chart via CBRT)\" width=\"1280\" height=\"960\" data-width=\"1280\" data-height=\"960\" meta-alt=\"Chart shows the Central Bank of the Republic of T\u00fcrkiye\u2019s total reserves, broken down into gold and foreign exchange, from January 2023 to April 2026. (Chart via CBRT)\"\/><br \/>\n<img decoding=\"async\" src=\"https:\/\/www.turkiyetoday.com\/s\/i\/i-fotobuyut.svg\"\/><\/p>\n<p>\nChart shows the Central Bank of the Republic of T\u00fcrkiye\u2019s total reserves, broken down into gold and foreign exchange, from January 2023 to April 2026. (Chart via CBRT)\n<\/p>\n<p>Energy costs keep inflation risks alive<\/p>\n<p>In March, T\u00fcrkiye\u2019s inflation came in at 1.9% on a monthly basis, beating expectations, while the annual inflation rate <a href=\"https:\/\/www.turkiyetoday.com\/business\/turkiyes-annual-inflation-drops-to-3087-in-march-3217389\" rel=\"nofollow noopener\" target=\"_blank\">edged down to 30.9%.<\/a><\/p>\n<p>Energy costs led price growth during the month, rising 4.9%, even as a fuel tax buffer reintroduced by the government helped tame the impact of higher oil prices.<\/p>\n<p>The system, known as a sliding scale fuel tax, adjusts fuel taxes in response to changes in global oil prices to help stabilize domestic pump prices.<\/p>\n<p>Although fuel accounts for only 3.2% of the weight in T\u00fcrkiye\u2019s Consumer Price Index (CPI), its broader impact across sectors remains a key risk to the disinflation trend.<\/p>\n<p>The central bank estimates that every 10% permanent increase in Brent crude adds 1.1 percentage points to inflation, widens the current account deficit by up to $4 billion, and trims growth by 0.4 to 0.7 percentage points over a year.<\/p>\n<p>Hovering around $99.4 per barrel as of Wednesday, Brent crude is 37% above pre-war levels, implying roughly a 4 percentage point increase in inflation.<\/p>\n<p><img decoding=\"async\" class=\"lazy\" src=\"https:\/\/www.turkiyetoday.com\/s\/i\/i-share.svg\"\/><\/p>\n<p>April 22, 2026 02:56 PM GMT+03:00<\/p>\n","protected":false},"excerpt":{"rendered":"The headquarters of the Central Bank of the Republic of T\u00fcrkiye (CBRT) in Ankara, T\u00fcrkiye. (Adobe Stock Photo)&hellip;\n","protected":false},"author":2,"featured_media":405134,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[114,184,85,46],"class_list":{"0":"post-405133","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-economy","10":"tag-il","11":"tag-israel"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/405133","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/comments?post=405133"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/posts\/405133\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media\/405134"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/media?parent=405133"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/categories?post=405133"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/il\/wp-json\/wp\/v2\/tags?post=405133"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}