TIM Chairman Mehmet Büyükekşi issued a press release today about the interest rate reduction decision made by the Central Bank. In his press release, Büyükekşi said that the interest rate reduction decision was received positively on behalf of our country and our exporters and indicated that in the future process, both the developments in global markets and the domestic indicators are favorable for new reductions.
- The expansionist monetary policies in the global markets present a suitable environment for interest rate reductions in Turkey.
- The recent developments in Turkish economy also leave room for further interest rate reductions.
- We, as Turkish Exporters Assembly, find the interest rate reduction decision of the Central Bank favorable for our country and for exporters. We expect the reduction process to continue and the market interest rates to be reduced in the coming months.
In 2015, as a result of FED's interest rate hike process dollar was strengthened in global markets and capital exits were experienced in developing economies as a result of this; so monetary policies applied in these countries were tightened. In 2016, on the other hand, after the interest rate increase, expectations for an additional interest rate increase have grown weaker. On the other hand, after the Brexit decision, Central Bank of England turned towards interest rate reduction and supplementary monetary incentive policy. In a similar manner, European Central Bank and Japan European Central Bank continue with their monetary incentive policies. Therefore, the expansionist monetary policies in the global markets present a favorable environment for interest rate reductions in Turkey.
All these favorable developments in the domestic and foreign markets present us with significant opportunities for additional interest rate reductions in the future period. In spite of the unfavorable developments we have been through recently, we, as Turkey, must increase our production, investment and export even further. In order for this to happen, the reductions in the interest rates that go on for some time now, must continue. However, the reaction of the Central Bank's interest rate reduction decision on the markets is not at the desired level yet. In order for the interest rate reduction decisions to be reflected on investments and production, we expect the market interest rates to be brought to much lower levels.