IMF Recommends Continued Tight Monetary Policy in Turkey

ISTANBUL (Reuters) – The International Monetary Fund (IMF) has called for a continuation of tight, data-driven monetary policy in Turkey until inflation aligns with targets, following the conclusion of an Article IV consultation.

Key Points

• Higher interest rates since June last year have helped reduce economic imbalances and revive confidence, according to the IMF's Saturday statement.
• Improved market sentiment has led foreign and domestic investors to opt for lira-denominated assets.
• The central bank has raised its main policy rate from 8.5% to 50% to combat high inflation.
• The government has increased taxes and fees to enhance revenue while implementing fiscal measures to mitigate economic risks.