The Central Bank’s Monetary Policy Committee (PPK) kept the policy rate unchanged at 14% for the seventh consecutive time in line with market forecasts. This despite the fact that inflation has reached 80% and USD/TRY has hit a record annual high. The PPK cut the interest rate by 100 basis points for the last time in December 2021. The PPK statement emphasized the possibility of a global recession and also pointed out increasing inflation worldwide and deteriorating forecasts. The Central Bank, which said the possibility of a recession may adversely affect the current account balance, indicated that a new step would be taken for loans.
USD/TRY, which rose to 17.73 prior to the PPK’s policy rate decision, hovered around 17.68 after the Central Bank announced the interest rate decision. However, it is traded at 17.74 this morning.
Turkey’s benchmark stock index Borsa Istanbul closed at 2,511.37 points yesterday, falling 0.55% following the PPK’s decision to keep the interest rate unchanged. Starting the day at 2,528.51 points, the BIST 100 index was down by over 13.83 points from Wednesday’s close of 2,525.20. The total market value was TRY 2tr by market close, with a daily trading volume of over TRY 29.3bn. Analysts said 2,490 points will be the support level and 2,550 points will be the resistance level for the BIST 100 index, in technical terms.
An agreement to restart grain shipments from Ukraine will be signed in Istanbul today, according to the Communications Directorate. President Recep Tayyip Erdogan, UN Chief Antonio Guterres as well as Russian and Ukrainian parties will attend the ceremony at the Dolmabahce Presidential Office. Turkish, Ukrainian, Russian and UN officials agreed at a meeting last week to establish a coordination center in Istanbul to facilitate Ukrainian grain exports.
Turkey laid the foundation for the fourth reactor of the Akkuyu nuclear power plant in Mersin yesterday. Work on the fourth reactor means that the country’s first nuclear plant is one step closer to the official start of electricity generation, set for 2023. The four reactors are expected to operate around the clock for 60 years.
DAILY AGENDA
The number of newly established companies increased by 40.1% to 13,396 in June, compared to the same month last year, according to the Union of Chambers and Commodity Exchanges of Turkey (TOBB). The number of liquidated companies jumped 115.3% to 2,640 in the same period.
The financial services confidence index rose by 3.8 points to 171.8 points in July month-over-month, according to the Central Bank.
The Agricultural Input Price Index soared 123.72% in May, year-over-year, according to the Turkish Statistical Institute (TurkStat). The index climbed by 5.51% on a monthly basis.
Meanwhile…
>> Residents’ FX deposit accounts surged by USD 2.07bn in the week ending on July 15, compared to the previous week, according to the parity-adjusted data from the Central Bank.
>> The Central Bank’s international net reserves rose by USD 283m to USD 6.35bn in the week ending on July 15, compared to the previous week. The bank’s total reserves increased by USD 714m to USD 99.36bn in this period.
>> Foreign investors’ net equity and government debt securities outflows from Turkey totaled USD 37.4m and USD 41.9m, respectively, in the week ending on July 15, according to the Central Bank.
>> The electric scooter rental company Marti will go public in New York. The company completed its IPO (initial public offering) preparations through the U.S.-based SPAC (special-purpose acquisition company) Galata Acquisition Corp.
