"The operational framework of the monetary policy will be maintained"

Regional Economy 25.03.2021, 15:25
14
"The operational framework of the monetary policy will be maintained"

Şahap Kavcıoğlu, Governor of the CRBT, came together with the representatives of banks within the Participation Banks Association of Turkey (TKBB), which are not managed by Banks Association of Turkey (TBB), in a meeting hosted by the TBB. The meeting's agenda focused on various subjects from inflation to monetary policy, from global developments to demands that arise from the banking sector.

Monetary policy tools will be used appropriately

Sources revealed that the Central Bank will be strictly adhering to the government's goal of reducing inflation to around 5% in the medium term, and the bank will use the monetary policy tools appropriately to attain this goal.

Senior bankers stated that the CBRT will continue to assume its monetary policy stance in a way that will ensure a permanent decrease in inflation, taking into account the inflation outlook, actual inflation, and expected inflation rates.

Portfolio preferences will be important indicators of policy decisions

Emphasizing in the meeting that the one-week repo interest rate will continue to be the main policy tool, and the operational framework of the monetary policy will be maintained, the sources revealed that global capital flows, actual returns of similar countries, and portfolio preferences of residents will be important indicators of policy decisions.

Representatives of the banking sector stated that the CBRT will make its decisions by taking into account all the data flow for the macroeconomy, especially the inflation, in a data-oriented approach.

Pointing out that the CBRT will continue to adhere to the free-market rules and floating rate system, it was stated that the CBRT will keep its communication channels fully open with the banking sector and other shareholders.

Emphasizing the fruitful aspect of the meeting, the bankers also added that the CBRT will not intervene in banks in any way, also the Central Bank and other banks will manage their own balance sheets.

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