Former Central Bank chief economist Prof. Dr. Hakan Kara said recent fund market developments could slow growth and ease inflationary pressures, noting a 100-basis-point rate cut may be preferred at the Central Bank (TCMB) October meeting.
Kara stated that under normal conditions such a negative shock could bring a 150-200 basis point cut onto the agenda, but that risks of a shift to foreign currency and reserve loss limit the Central Bank's hand. Therefore, he expects a more cautious step.