Press Release on Interest Rates (2026-23)

Yaşar Fatih Karahan (Governor), Hatice Karahan, Fatma Özkul, Gazi İshak Kara, Yusuf Emre Akgündüz, Elif Haykır Hobikoğlu.

The Monetary Policy Committee (the Committee) has decided to keep the policy rate (the one-week repo auction rate) at 37 percent. The Committee has also maintained the Central Bank overnight lending rate and the overnight borrowing rate at 40 percent and 35.5 percent, respectively.

The underlying trend of inflation, which increased in April due in part to higher energy prices, following its rise in the first months of the year, decreased slightly in May. Amid geopolitical developments and the resulting uncertainties, energy prices remain volatile and elevated. First quarter data point to a slowdown in economic activity, and leading indicators suggest a continued weak course in domestic demand. The impact of geopolitical developments on the inflation outlook through the cost channel, economic activity and expectations is closely monitored.

The tight monetary policy stance, which will be maintained until price stability is achieved, will strengthen the disinflation process through demand, exchange rate, and expectation channels. The Committee will determine the policy rate by taking into account realized and expected inflation and its underlying trend in a way to ensure the tightness required by the projected disinflation path in line with the interim targets. Monetary policy decisions are made prudently on a meeting-by-meeting basis with a focus on the inflation outlook. In case of a significant and persistent deterioration in the inflation outlook, monetary policy stance will be tightened. The Committee reiterated that it remains highly attentive to upside risks on inflation.