---
source: Central Bank of the Republic of Turkey (TCMB)
url: https://www.tcmb.gov.tr/wps/wcm/connect/EN/TCMB+EN/Main+Menu/Announcements/Press+Releases/2026/ANO2026-14
document_type: pdf
date_retrieved: 2026-03-18
period: March 12, 2026 Meeting
parent_publication: Monetary Policy Committee Meeting Summary
indicators_covered: [Interest Rate, Policy Rate, Monetary Policy Decision]
---

# Summary of the Monetary Policy Committee Meeting

**Publication Date:** March 18, 2026, No. 2026-14  
**Meeting Date:** March 12, 2026

## Key Decision

**The Monetary Policy Committee (the Committee) has decided to keep the policy rate (the one-week repo auction rate) at 37%. The Committee has also maintained the Central Bank overnight lending rate and the overnight borrowing rate at 40% and 35.5%, respectively.**

## Global Economy

Global growth index projected to increase by **2.2% annually in 2026 and 2027** (revised downward). Rising commodity prices heightened risks to global inflation as central banks remain vigilant. Geopolitical developments in late February elevated uncertainties regarding energy supply, supply chains, and transport costs.

## Monetary and Financial Conditions

- TRY deposit rates: **44.4%** (up 39 bps from January 23)
- TRY commercial loan rates: **48.3%** (up 239 bps)  
- Gross international reserves: **USD 197.5 billion** (down USD 18.1 billion since January 23)
- CDS premium: **254 basis points** (up 40 bps since January 21)

## Economic Activity & Employment

- Q4 2025 GDP: **+3.4% YoY, +0.4% QoQ**
- Full-year 2025 growth: **3.6%**
- Unemployment rate (January): **8.1%** (down from 8.3%)
- Employment: **32 million people**

## Inflation Developments (February 2026)

- **Annual inflation: 31.53%** (up from 30.65%)
- B index: **29.91%** (down 0.20 ppts)
- C index: **29.46%** (down 0.34 ppts)
- Goods inflation: ~**27%**
- Services inflation: ~**40%**

**Key drivers:** Food group most prominent (Ramadan + weather). Communication services +8.73% monthly (mobile charges). Rent inflation 53.91% annually. Producer prices +2.43% monthly, +27.56% annually.

**Inflation Expectations (Market Participants):**
- 2026 year-end: **24.1%** (up 0.9 ppts)
- 2027 year-end: **18.4%** (up 0.6 ppts)
- 12-month ahead: **22.1%**
- Firms' expectations: **32.0%**
- Households' expectations: **48.8%**

## External Sector

- 2025 current account deficit (revised): **USD 30.1 billion** (revised up from USD 25.2B)
- 12-month cumulative deficit: **USD 32.9 billion**
- Services balance surplus: **USD 63.1 billion**
- Trade financing favorable: banking sector rollover ratio 167.2%, non-bank corporate 214.4%

## Energy & Commodities

- Brent crude oil (February avg): **USD 71.1/barrel**
- Brent crude oil (March 11 avg): **USD 88.5/barrel** (up due to geopolitical risk)
- TTF natural gas prices notably up
- Mitigation: Sliding-scale tariff launched; customs duty on fertilizer imports abolished

## Monetary Policy Actions

**Rate Decision:**
- Policy rate: **37%** (held)
- Overnight lending rate: **40%** (held)
- Overnight borrowing rate: **35.5%** (held)

**Unconventional Measures (Effective March 2):**
- **One-week repo auctions suspended**
- Average funding cost: **40%** (overnight lending rate)
- Turkish lira-settled FX forward selling transactions launched
- Macroprudential measures: reserve requirement adjustments and credit growth limits

**Forward Guidance:**
- Tight policy maintained until price stability achieved
- Medium-term inflation target: **5%**
- **"In case of a significant and persistent deterioration in the inflation outlook, monetary policy stance will be tightened."**

## Assessment & Outlook

**Disinflation Progress:** Underlying inflation trend essentially flat. B and C indices show moderation. Demand conditions continue supporting disinflation, though at moderating pace.

**Upside Risks:** Geopolitical volatility affecting commodity prices. Services inertia (40% vs 27% goods). Household expectations still at 48.8%. Brent crude swings (71-88.5 USD range). Strait of Hormuz closure raising shipping costs.

**Downside Supports:** Sliding-scale tariff limiting pass-through. Credit growth moderating (2.7%). Core goods inflation weak. Global growth subdued (2.2% forecast).

## Key Metrics

| Metric | Value | Change |
|--------|-------|--------|
| Policy Rate | 37% | Held |
| Overnight Lending | 40% | Held |
| Annual Inflation (Feb) | 31.53% | +0.88 ppts |
| B Index | 29.91% | -0.20 ppts |
| C Index | 29.46% | -0.34 ppts |
| Reserves | USD 197.5B | -USD 18.1B |
| CDS Premium | 254 bps | +40 bps |
| Unemployment | 8.1% | -0.2 ppts |