6 MAY 2021 CENTRAL BANK MONETARY POLICY BOARD MEETING DECISION

CBRT Monetary Policy Committee (MPC) held its last meeting on May 6, 2021. Before the meeting, the expectation in the market was that the policy rate would be kept constant. Most recently, at the meeting chaired by Naci Ağbal on March 18, 2021, the one-week repo auction interest rate, which is the policy rate, was increased by 200 basis points to 19 percent. In the second MPC meeting held during the term of the new CBRT president Şahap Kavcıoğlu, it was decided to keep the policy interest rate constant. This decision did not have any effect on prices in the market as it was pre-priced.
In its announcement, the MPC stated that taking into account the high levels of inflation and inflation expectations, the current stance in monetary policy will be maintained until a significant decrease in the April Inflation Report forecast path is achieved. In addition, he emphasized again that he will continue to use all the tools at his disposal in line with the main objective of price stability, and that the policy rate will continue to be set at a level above inflation until strong indicators are formed that point to a permanent decline in inflation and the medium-term 5 percent target is reached and the policy rate will be maintained at a level above inflation. expressed.