Key Points
- SMEs' access to credit may be facilitated
- Exchange rates may be allowed to rise as much as inflation
- Market interest rates may decline
By the Numbers
The government has given a signal of softening in economic policies. It is claimed that SMEs' access to credit will be facilitated, and the 'valuable TL' policy will be reversed, allowing exchange rates to rise as much as inflation. Economists have interpreted this news as 'the first step of election economy'.
The economic administration will make a 'calibration' adjustment to the tight monetary policy. According to information from real sector and banking sources, the tight monetary policy will be touched in three areas to slightly relieve the real sector. It is claimed that the funding interest rate of 40% will be reduced to the policy interest rate level of 37%.
After increasing criticism of exchange rates, the value loss of the TL may accelerate. Although monthly inflation has been above 2% since the beginning of the year, the dollar exchange rate has been rising by 1.2% in the first months and 1.6% in the last months.
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Frequently Asked Questions
- What is election economy?
- Election economy refers to the changes made by governments in economic policies during election periods.
- How can SMEs' access to credit be facilitated?
- SMEs' access to credit can be facilitated by reducing funding interest rates and easing growth restrictions.
- What does it mean to allow exchange rates to rise as much as inflation?
- Allowing exchange rates to rise as much as inflation means that the value loss of the TL may accelerate.
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