TCMB's Interest Rate Cut Expectations Are Rising: Economists' Predictions.

Economists Revealed Their Expectations

In domestic markets, all eyes are on the Central Bank of the Republic of Turkey (CBRT) which is set to announce its last interest rate decision of the year next week. Economists continue to share their forecasts regarding how the CBRT will determine interest rates. In the survey conducted by Matriks Haber for the December CBRT Monetary Policy Committee (MPC) meeting, 27 economists provided their views.

Interest Rate Cut Expectations and Predictions

The median expectation among economists for the last MPC meeting of the year is for the policy interest rate to be cut by 150 basis points, bringing it down from 39.5 percent to 38 percent. Among the economists surveyed, 9 people expect a cut of 100 basis points, 11 people expect a cut of 150 basis points, and 7 people anticipate a cut of 200 basis points. Following the decision to be made at this year's final MPC meeting, the interest rate forecast for the end of 2025 is also expected to be 38 percent.

2026 Interest Rate Predictions

The median expectation for the year 2026 shared by 23 economists is at 28 percent. These predictions vary among economic analysts, ranging from 25 to 31 percent. It has been announced that the Central Bank’s interest rate decision will be revealed on Thursday, December 11 at 14:00.

Evaluation from QNB Turkey

QNB Turkey Economist Deniz Çiçek linked the decline in monthly inflation in November to the reduction in unprocessed food prices, providing insights on the course of inflation figures. Çiçek emphasized that no improvement has been observed in the service inflation framework and noted that the main trend of inflation has been hovering around 2 percent for a long time.

Çiçek stated that the CBRT will determine its upcoming interest rate cuts by carefully considering the inflation outlook. The economist remarked, “Unless there is a significant decline in the inflation trend, we do not expect the amount of interest rate cuts to increase.” He anticipates a 100 basis point cut in the upcoming MPC meeting, similar to the previous meeting.