Exciting News: Turkey Cuts Interest Rates to Boost Economic Growth

The Central Bank of Turkey has announced a 2.5% reduction in its key interest rate, bringing it down to 47.5%. This marks the first rate cut in nearly two years as part of efforts to stimulate the economy and tackle high inflation.

The interest rate had remained steady at 50% for the past eight months following a series of hikes aimed at curbing soaring prices. Despite these measures, Turkey's economy grew by 2.1% year-on-year in Q3 2023, falling short of expectations due to the adverse impact of high interest rates on industrial production and investment.

Meanwhile, annual inflation slowed significantly to 47.1% in November 2023, down from a peak of over 75% earlier in the year. The central bank projects inflation to decline further, reaching 44% by the end of the year and 21% by the end of 2025.

Additionally, the Turkish government announced a 30% increase in the minimum wage starting in 2025, aiming to enhance purchasing power and support economic growth.

This move comes as Turkey continues to position itself as an attractive destination for investors, particularly in the thriving real estate sector that remains a key focus for Arab and international capital.

Source: Al Jazeera