Türkiye Cumhuriyet Merkez Bankası — Policy Preview

Decision due: Thursday, 10 September 2026, usually 14:00 +03 · Current one-week repo rate: 37%

1. Executive summary

The Monetary Policy Committee is expected to hold the one-week repo rate at 37% at the 10 September decision. The single most important driver is headline CPI, which eased only modestly to 31.5% in August yet remains far above the 5% target. The key risk is that a further softening in activity and rising unemployment could tilt the committee towards earlier easing if the disinflation process accelerates faster than anticipated in the governor’s communications.

2. The call

We expect the committee to leave the one-week repo rate unchanged at 37%. This would extend the pause that has kept the rate steady since the start of the year, following the sequence of cuts recorded through late 2025. Positioning appears consistent with a hold, and our call aligns with that view. Conviction is high: only a significant deviation in the inflation outlook from the interim targets, or a marked deterioration in expectations, would prompt a move. Communications from the governor since the start of the year have repeatedly emphasised the need to sustain the tight stance until price stability is achieved, providing the clearest anchor for this meeting.

3. The committee

Governor Karahan’s communications have consistently underscored the need to "maintain our tight monetary policy stance until price stability is achieved", with the communication published on 14 May 2026 the most recent. The committee has operated by consensus throughout the recent easing and subsequent pause, and English-language statements list participants without attributing individual positions.

4. Data since the last decision

No new release since the last decision for: Headline CPI (YoY), Unemployment rate, Real GDP growth (YoY) — the committee sees the same print(s) it saw last time. Market rows are measured from the 22 Apr close — the last observation common to every market series on or before the last decision. Priors marked "revised" are the source's current vintage for that period, which differs from the figure as first published. Market as-of 04 Sep (5 days before generation). WTI crude oil (USD/bbl) inter-meeting high 112.25 on 18 May (+18.5% from the decision close).

Headline CPI continues to decline, albeit at a modest pace that leaves it well above the 5% target. The August reading came in slightly below consensus, yet the trajectory remains too gradual to declare victory on disinflation. Real GDP growth surprised on the soft side in the second quarter and unemployment has risen, pointing to some loss of momentum in activity and a labour market that is no longer tightening. Oil prices have fallen since April, which should provide a modest tailwind to the inflation outlook over coming months.

The outlook the committee confronts is therefore one of sticky inflation still heading only slowly towards target, combined with activity that is below trend and a labour market showing tentative signs of slack. Headline CPI and its momentum remain the dominant influence on the hold call; the softening in growth and employment are not yet strong enough to override that signal, but they bear watching for any acceleration in the disinflation process.

5. What the speeches say

Governor Karahan’s most recent communication, published on 14 May 2026, reiterated that “we will maintain our tight monetary policy stance until price stability is achieved, in line with our interim targets” and that “we have built our forecasts on the assumption that the monetary policy stance will remain tighter for a longer period compared to the previous reporting period”. February 2026 remarks struck the same tone: “These developments suggest that we should stand firm in maintaining our tight stance,” while noting that “risks to the disinflation process are alive.” Communications from August and May 2025 likewise emphasised that “This requires us to maintain our tight and decisive monetary policy stance” and a readiness to tighten further if inflation deteriorated persistently.

Taken together, the record shows no softening in the governor’s reaction function. The repeated insistence on sustaining the tight stance until inflation is on a permanent downward path aligns with the decision to pause cuts earlier this year and to hold through the summer. Its emphasis on tighter-for-longer assumptions continues to frame the current pause as appropriate rather than the prelude to renewed easing.

6. Scenarios

7. Into the meeting

The statement is likely to repeat the formulation that the tight stance will be maintained until price stability is achieved, with any revision in the balance of risks or the description of inflation momentum the main focus. The press conference that follows will be the first opportunity to clarify whether the committee sees the recent softening in activity as sufficient to bring forward easing, or whether the still-elevated inflation level continues to dominate. Immediate market attention will centre on any shift in the governor’s characterisation of the disinflation process and on guidance for the path after this meeting.

The September CPI print due on 5 October lands shortly after the decision and will set the tone for the 22 October meeting; the August balance-of-trade and unemployment figures due on 30 September are secondary but will colour interpretations of the growth slowdown already visible in the second-quarter GDP release.

Full analysis on the RoboMacro site → /central-banks/CBRT