Turkish central bank lowers interest rate to 12%

ZEYNEP BILGINSOY

ISTANBUL (AP) — Turkey’s central bank has delivered another interest rate cut and lowered the benchmark rate by 1 percentage point to 12%. The bank’s action on Thursday is the reverse of what other world economies are doing to combat soaring inflation. The lira was trading around 18.38 against the dollar, weakening beyond the previous record low of 18.36 in December. The Central Bank of the Republic of Turkey has followed President Recep Tayyip Erdogan’s unorthodox belief that high interest rates cause high inflation. In other parts of the world, banks are increasing borrowing costs to combat inflation. Official statistics earlier this month showed Turkey’s annual inflation rate at 80.21%.