June 25, 2020 / 11:19 AM / 12 days ago

Turkish cenbank keeps policy rate unchanged in surprise halt to easing cycle

ISTANBUL, June 25 (Reuters) - Turkey’s central bank kept its key interest rate unchanged at 8.25% on Thursday, halting a nearly year-long easing cycle that aimed to stimulate an economy battered by a slowdown last year and the coronavirus pandemic.

The bank had cut its policy rate in nine consecutive meetings since July last year, when it stood at 24%. The policy rate still remains below Turkey’s inflation rate of 11.4%, leaving real rates in negative territory.

The aggressive easing cycle was at first meant to pull the economy out of a recession, and later to blunt fallout from the pandemic that brought Turkey’s economy to a virtual standstill in the second quarter.

Economists polled by Reuters expected a 25-point cut.

Reporting by Ali Kucukgocmen, Can Sezer and Ezgi Erkoyun; Editing by Jonathan Spicer

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