Turkiye’s Central Bank hiked interest rates Thursday by 500 basis points, from 35% to 40%.
The hike was larger-than-expected as a Reuters poll from earlier this week suggested a hike of some 250 basis points.
The decision comes as Turkish President Recep Tayyip Erdogan said earlier this week that Turkish lira depreciation has come to an end.
“The disinflation program we’ve implemented will highly likely lead to a real appreciation of the lira. So, Turkish lira depreciation has come to an end,” Erdogan told reporters, speaking on his return from Algeria late Tuesday, according to a text released by the Turkish Presidency Communications Directorate.
The increase marks the sixth in a row since June following May general elections under Central Bank Governor Gaye Erkan.
Abandoning his unconventional economic policy of defending low interest rates, Erdogan appointed Erkan and Finance Minister Mehmet Simsek at the helm of the economy both mainstream economists.