The Central Bank of Turkey took additional tightening measures to support the tight monetary policy. It lowered the monthly growth limit for TL commercial loans from 2.5 percent to 2 percent and for general purpose loans from 3 percent to 2 percent.
The Central Bank of the Republic of Turkey (CBRT) introduced additional tightening steps. The decision was published in the Official Gazette.
In the announcement, the bank said within the scope of the loan growth-based securities facility, monthly growth limit for TL commercial loan was reduced from 2.5 percent to 2 percent, monthly growth limit for general purpose loans from 3 percent to 2 percent, and it maintained the 2 percent limit for vehicle loans.
‘ADDITIONAL STEPS ARE BEING WORKED ON’
CBRT also announced its ongoing efforts to establish loan growth-based reserve requirements to increase the effectiveness of the implementation of credit growth limits, in addition to the securities facility. The statement said “In addition, additional steps are being worked on to strengthen the monetary transmission mechanism”.
‘MONETARY TRANSMISSION MECHANISM TO BE SUPPORTED’
In the summary of the CBRT Monetary Policy Committee meeting held on February 22, it was stated that “The monetary policy stance will be tightened in case of a significant and permanent deterioration in the inflation outlook. In case of unanticipated developments in credit growth and deposit rates, the monetary transmission mechanism will be supported.”