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The interest rate decision of the Central Bank of the Republic of Türkiye (CBRT), which is being closely followed by the markets in Türkiye, stands out as the most important agenda item of this week.
At its September meeting, the policy rate had been lowered to 40.50%. When we recall the latest developments before the decision on Friday, Oct. 23:
These developments brought about the predominance of expectations in the market that interest-rate cuts may continue with “more limited steps.”
For the stock markets, and especially for the driving force banking sector, this expectation stands out as a “pressure factor.”
The Borsa Istanbul BIST 100 index also lost 4.77% in value last week, closing at 10,208 points. During the week, the index tested a low of 10,053 and a high of 10,683 points.
In the market, the reaction coming from levels close to the critical 10,000 support is regarded as “positive.”
However, it is also emphasized that for this reaction to gain significance, it is important that 10,000 continues to hold, that the 10,280 intermediate resistances be exceeded, and that the index rise above 10,550, where the 100-day average is approaching.
Another important agenda item of this week is also the CHP congress lawsuit to be held on Friday, Oct. 24. The annulment or postponement of the lawsuit is shown by the market as scenarios that would be received positively.
As a result, on the economic side, the continuation of the disinflation process may once again come to the fore as a catalyst in the stock exchange during the last quarter of the year.
In this sense, the inflation data to be announced in the coming months have become more important. On the political side, the elimination of uncertainty also seems likely to support the dissipation of the fog clouds in front of the markets.
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