July 15 was made a national holiday in 2016 to mark the coup attempt, which was carried out by a fraction within the Turkish Armed Forces that organized themselves as the Peace at Home Council. They attempted to seize control of several places in Ankara, Istanbul, Marmaris and elsewhere, such as the Asian side entrance of the Bosphorus Bridge but failed to do so after forces loyal to the state defeated them. The government said the coup leaders were linked to the Gulen movement, which is designated as a terrorist organization and led by Fethullah Gulen residing in Pennsylvania.
Prior to the national holiday, the Central Bank kept the interest rate steady at 19% in line with market expectations. It emphasized that the current tight monetary policy stance will be maintained decisively until the significant fall in the April Inflation Report’s forecast path is achieved. The bank, which pointed out the rising global inflation, has included the effect of increasing electricity and natural gas prices in the statement. Its expression that the current account balance will post a surplus rest of the year was perceived as a message that the bank expects stabilizing movement in foreign exchange rates and rapid increase in tourism incomes.
The U.S.-based JP Morgan, which released an analysis after the interest rate remained unchanged, stressed that the bank warned about summer volatility in inflation but didn’t present a new policy guideline, and that economic activities and price pressures may potentially pave the way for a later and slower easing circle. The institution forecasts the first 50-basis-point reduction in October.
Markets are closed in the country due to the national holiday. However, USD/TRY fell below 8.60, while EUR/TRY is traded at 10.17 at the international markets. Spot gold, meanwhile, surged by 0.22% to USD 1,831 per ounce, while brent crude dropped by nearly 1.52% to USD 73.62 per barrel.
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