What matters this morning

As we approach to the weekend after a busy agenda in terms of economic data, the markets are focused on Central Bank’s interest rate decision. The interest rate, which has been set as 19%, is expected to remain unchanged due to the upward risks in inflation, according to surveys. The Monetary Policy Committee (PPK) is estimated to lower the interest rate most likely in the last quarter of the year. The projected interest rate cut will be lower than the past, according to economy circles.   

The White House, in the meantime, has announced that President Joe Biden is tapping former Senator Jeff Flake to be the U.S.’s next ambassador to Turkey. “With this nomination, the Biden Administration reaffirms the best tradition of American foreign policy and diplomacy: the credo that partisan politics should stop at the water’s edge. U.S. foreign policy can and should be bipartisan. That is my belief as well, and my commitment,” said Flake. Former Senator is a known figure with his opposition to the former U.S. President Donald Trump.

Looking at the money market prior to the PPK’s interest rate decision, USD/TRY which has fallen below 8.60 for the first time since the middle of June, slightly exceeds 8.63 this morning, while EUR/TRY rose to 10.17.

Oil prices and gold prices are also on the rise. Brent crude reached USD 76.28 per barrel, while the yellow metal is traded at USD 1,813.


The Producer Price Index of Agricultural Products (Agriculture-PPI) surged by 21.76% in June, compared to the same month of the previous year, according to the Turkish Statistical Institute (TurkStat). Agriculture-PPI also rose by 1.76% on a monthly basis.

The short-term external debt stock rose by 4.6% to USD 144.9bn in May, compared to the end of 2020, according to the Central Bank.

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