Kavcıoğlu: Tight Monetary Policy Will Become a Buffer

Governor of the Central Bank of the Republic of Turkey (CBRT), Şahap Kavcıoğlu, said that tight monetary policy will act as a buffer against volatility.

The Central Bank of the Republic of Turkey (CBRT) published its 32nd Financial Stability Report. In the preface of the report, CBRT Governor Şahap Kavcıoğlu stated that the risks arising from the asset quality of banks are at a manageable level and that the decline in loan growth rates is expected to continue. In the preface, it was pointed out that there was an increase in household and real sector indebtedness during the epidemic period, while it was noted that the tight monetary policy would act as a buffer against volatility. Stating that the CBRT will continue to use all the tools at its disposal for the main purpose of price stability, Kavcıoğlu underlined that the stability to be achieved in the general level of prices will positively affect macroeconomic and financial stability through the decrease in country risk premiums, the initiation of reverse currency substitution, the upward trend in foreign exchange reserves and the permanent decline in financing costs.