Erdogan: 2025 to be landmark for interest rate cuts

By Aya El Sayed On Dec 29, 2024

Türkiye’s President Recep Tayyip Erdogan said on Saturday he expects more interest rate cuts in 2055, reiterating his belief that reduced rates will curb inflation.

“Priority in our economy programme is to lower the inflation… We will hopefully reduce inflation to the required level by using other tools at our disposal in addition to the monetary policy,” Erdogan said to the members of his AK Party (AKP) in northwestern city of Bursa.

“We will definitely start lowering the interest rates. 2025 will be the landmark year for this,”

The statement follows the Central Bank’s recent cut to its policy rate, reducing it from 50 per cent to 47.5 per cent at its December meeting, exceeding market expectations.

Despite earlier shifts to orthodox monetary policies and steep rate hikes, Erdogan’s remarks signal a potential return to unconventional approaches.

Erdogan also criticised “opportunists” for contributing to inflation, urging citizens to boycott businesses that raise prices excessively. Analysts anticipate significant rate cuts in 2025, though officials warn against an uninterrupted easing cycle.

Attribution: Bloomberg & Reuters

Subediting: Y.Yasser