ANKARA, Dec. 28 (Xinhua) -- Turkish President Recep Tayyip Erdogan confirmed on Saturday that additional policy rate cuts are expected in 2025, following the central bank's recent decision to reduce its key interest rate by 250 basis points to 47.5 percent.
"We will absolutely begin lowering interest rates. The year 2025 will be a turning point for this effort," Erdogan said during a meeting with members of his ruling Justice and Development Party (AKP) in Bursa, a city in northwestern Türkiye.
Erdogan emphasized that reducing interest rates would help curb inflation, stating, "Interest rates will decrease, which in turn will reduce inflation. Taking this step is now indispensable for us."
He further outlined that the main objective of the government's economic program is to quickly address the welfare losses suffered by citizens due to exchange rate fluctuations and inflation. "The priority of the program we are implementing is to control inflation," he added.
On Thursday, Türkiye's central bank implemented its first rate cut in nearly two years, lowering its benchmark interest rate by 250 basis points to 47.5 percent. The bank cited slowing inflation as the primary rationale for the decision.
The country has faced persistently high inflation in recent years, prompting a series of aggressive rate hikes by the central bank, which raised its policy rate by a cumulative 4,150 basis points since mid-2023.
As a result of these disinflationary measures, Türkiye has managed to reduce year-on-year inflation from over 75 percent in May to 47.09 percent in November. ■
