Deutsche Bank brought forward its expectations for an interest rate cut in Turkey.

Deutsche Bank has brought forward its expectations for the first interest rate cut by the Central Bank of the Republic of Turkey (CBRT). The bank stated that the gradual slowdown has begun, and the core inflation dynamics indicate a 'more constructive' inflation outlook.

The report from the bank included the statement, "The consecutive negative inflation surprises over the last two months may lead the Central Bank not to change interest rates at this meeting."

"FIRST INTEREST RATE CUT IN DECEMBER"

The institution has revised its predictions regarding the timing of the first interest rate cut, moving its expectation of a 250 basis point rate cut, which was anticipated to start in January 2025, to December. Updates in the latest inflation forecasts, the Central Bank's 'less hawkish tone', and the resilient stance of the Turkish Lira despite fluctuations in global markets following the U.S. elections have brought forward the expectation of a rate cut.

The report emphasized that after December, the bank is expected to continue its cautious and gradual rate cuts. It is predicted that the headline inflation will fall below 2% month-on-month in November.

The report also stated that due to some risks such as inflation figures exceeding predictions in November and the increase in geopolitical tensions, the rate cut could begin in January.