Turkey´s 300bps hike: The later, the tighter

Summary

The CBRT decided yesterday to raise the “de facto” policy interest rate (Late Liquidity Window) by 300bps to 16.5% to correct the significant depreciation of the Turkish Lira, also with other reasons including the huge deviation of inflation from the target and expectations, financial stability motives and rapid loss of credibility during the last two weeks.

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