Wall Street expects a slowdown in interest rates in Türkiye

Global banks show doubt on the optimistic view of the Turkish central bank over the risks associated with inflation, and expect to delay the rate of interest rates tomorrow, Thursday. Central bank governor Fatih Ain said in an interview last week that the price pressure arising from demand still corresponds to the way of reducing inflation, despite the higher inflation data than expected and the growth of the economy in a stronger rate than estimates. His statements suggest that investors may have been rushed to lower their expectations for the frequency of interest rates. However, the message failed to persuade the market participants, who, together with the data, faced a state of political instability caused by the escalation of the confrontation between the most important opposition party in Türkiye and the judicial authorities. On September 15, a trial session will be presented on September 15 against the ‘People’s Party’, with the risk of excluding his national leadership and replacing it with guardians appointed by the court. Expectations of a smaller reduction in Türkiye, most analysts included in the “Bloomberg” poll, will expect the Monetary Policy Committee to lower interest rates, but at a slower rate than July 3. The estimates of the center of the survey analysts indicate a reduction of 200 basis points to 41%. Only two economists expect to lower the borrowing costs of the same size. Also read: Despite the turmoil of the market. Turkey holds the hope of controlling inflation and modified economists at Goldman Sachs, to see now that the interest rate will lower to 41%, which is slightly higher than the previous estimate of 39.5%. Analysts led by Kevin Daly said in a report on September 5: The risk of the highest Turkish assets was issued last week, which canceled the conference “Republican Volksparty” in Istanbul, which led to the suspension of party officials in the City of their duties, which reinforced the expectations of the national leadership. This has caused a wave of sale to Turkish shares and bonds that are denominated in the Turkish lira over the past week. The Istanbul 100 Stock Exchange Index has fallen by 7% since the decision was issued, while government banks sold the dollar to defend the currency in light of the increasing uncertainty, according to Bloomberg reported. It may be interested in: Government banks in Türkiye sell $ 5 billion to defend the lira, “Goldman Sachs” experts mentioned that this wave of sale increases the risk allowance, and the central bank should take this into account when deciding on the interest rate. Bloomberg Economics: The Turkish Central Bank is of the opinion that the facilitation area available at the meeting on September 11 was narrowed after a political judicial ruling that impaired the confidence of investors and reduced foreign exchange reserves. However, by the end of the year, we remain at our expectation of the interest rate at 35%, but the risks are prone to the upward trend due to the possibility that the lira is pushing more and the high price. Political makers are ready to intervene if the external factors have influenced the prospects of inflation, but he did not address the latest political turmoil. The Republican People’s Party Conference in Istanbul through a judicial decision on political concerns, and investors are now awaiting the party’s court hearing on September 15. Read: Turkey reduces the expectations of the growth of the economy and the priority is to indicate inflation and analysts of them, Onai, indicated that the lira’s assets are under pressure and that a 200 points are in the exchange market, which is that it is now base compared to the previous expectation of 250 points. 2028, political developments in the short term are still negative risks to the dynamics of the exchange market, inflation and interest rates. ‘