ISTANBUL, Sept 14 (Reuters) - Turkey’s central bank left its key interest rates on hold for the third straight meeting on Thursday, keeping monetary policy tight after annual inflation rose back into double digits last month.
The bank kept its late liquidity window, the highest of the multiple instruments it uses to set policy, at 12.25 percent and the benchmark repo rate at 8 percent.
Turkey’s central bank is tasked with balancing its fight against inflation pressures with regular calls for cheaper credit from President Tayyip Erdogan. Erdogan, who wants banks to lower the cost of credit to stimulate borrowing and bolster the economy, has described himself as an “enemy” of interest rates.
All 17 economists polled by Reuters had forecast the bank would leave the repo rate unchanged, and its overnight lending rate at 9.25 percent and overnight borrowing rate at 7.25 percent. Those two rates were also unchanged.
The central bank’s resistance to lifting the repo rate has triggered concern among investors over the extent of its independence in the face of criticism from Erdogan. (Reporting by Daren Butler; Writing by David Dolan; editing by John Stonestreet)