January 18, 2018 / 11:09 AM / a year ago

Turkey's central bank to maintain tight policy as keeps rates steady

ISTANBUL, Jan 18 (Reuters) - Turkey’s central bank said on Thursday it would keep monetary policy tight until it became clear that inflationary pressures were easing, as it kept interest rates steady.

Current elevated levels of inflation and developments in core inflation indicators pose risks to pricing behaviour and the bank would deliver further monetary tightening if needed, it said in a statement.

It kept all four of its policy rates on hold, as expected.

Annual inflation stood at 11.92 percent at the end of 2017, sharply above the bank’s official target of 5 percent, underscoring the difficulty the bank faces in balancing its fight to keep price pressures under control against demands for cheap credit from President Tayyip Erdogan.

The bank has used unorthodox tightening moves, heightening the perception it wants to avoid a conventional rate hikes in the face of Erdogan’s often stated opposition to high interest rates. (Writing by Ezgi Erkoyun; Editing by Toby Chopra)

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