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flag Türkiye's central bank cut interest rates to 37% on Jan. 22, 2026, citing easing inflation, but risks remain amid conflicting inflation data.

flag Türkiye's central bank cut its benchmark interest rate by 100 basis points to 37% on January 22, 2026, marking the fifth reduction since last summer as inflation eased to 30.89% in December, down from a peak of 75.4% in May 2024. flag The move reflects a cautious shift from tight monetary policy, with officials citing declining underlying inflation trends and weakening demand, though risks remain from inflation expectations and pricing behavior. flag The bank emphasized future decisions will depend on incoming data, maintaining a data-driven approach to achieve a 5% inflation target. flag While official figures show disinflation, independent estimates report significantly higher inflation, highlighting uncertainty. flag The central bank also reduced its overnight lending and borrowing rates to 40% and 35.5%, respectively, and projected inflation could reach 13%–19% by end-2026.

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