ISTANBUL – Turkey's Central Bank has raised its interest rates, a move experts say is meant to support the currency after steep drops recently.
Continue Reading Below
The bank said Thursday it was raising the overnight marginal funding rate by 0.25 percent points to 8.5 percent. The one-week repo rate was increased by 0.5 percentage points to 8 percent.
The bank's move came despite pressure from President Recep Tayyip Erdogan for lower interest rates. Higher rates tend to boost a currency but weigh on the economy by making borrowing more expensive.
The central bank's monetary policy committee noted that "exchange rate movements due to recently heightened global uncertainty and volatility pose upside risks on the inflation outlook."
The move comes as the European Union parliament approved a non-binding resolution to freeze Turkey's membership talks.