LONDON (Reuters) – Stronger-than-expected Turkish inflation data led JPMorgan on Monday to add another 500 basis point interest rate hike to their forecasts for the country in April, a move that, if correct, would hoist Turkey’s headline rates to 50%.
The U.S. investment bank previously expected Turkey’s recent hike, to 45%, to be the last of the current cycle, which has seen the bank jack up rates by a huge 3,650 basis points since June.
“Headline CPI inflation came in at 4.5% m/m in February, much higher than our expectation of 4.2% and the market consensus of 3.8%,” JPMorgan said in a research note.
The bank kept its year-end policy rate forecast of 45%, however, saying the Turkish central bank might cut its policy rate in November and December.
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