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The Central Bank of the Republic of Turkey (CBRT) cut rates 100bps to single-digit territory, two days ahead of its 19 March monetary policy committee (MPC) meeting, analysts at Standard Chartered Bank reports. USD/TRY is trading at 6.430 after falling in the last minutes.

Key quotes

“In an unscheduled MPC meeting on 17 March, the CBRT cut the weekly repo rate 100bps to 9.75%.”

“We lower our 2020 C/A deficit forecast to -0.7% of GDP (from -1.3% prior) and our 2020 average inflation forecast to 10.2% (11.25% prior).”

“We lower our 2020 year-end policy rate forecast to 8.75% on these conducive conditions.”

“We think looser financial conditions will bode well for growth in H2-2019, after a slowdown at end-Q1 and likely into Q2, given the spread of coronavirus.”