JPMorgan expects Turkey to cut rates by 100 bps in October and December

By Reuters News13:31 (UTC), 25 September 2026 Updated

GDANSK, Sept 25 (Reuters) - JPMorgan expects Turkey's central bank to cut interest rates by 100 basis points at its October 22 meeting and again in December, bringing its main rate to 35% by the end of the year, as underlying inflation eases despite higher energy prices.

On a seasonally adjusted basis, monthly headline inflation momentum is expected to have slowed in September to 1.9% from 2.3% in August, while core inflation momentum is forecast to ease to 1.6% from 2.0%, JPMorgan said ahead of the October 5 release.
Annual inflation is expected to ease to 30.2% from 31.5% in August despite an expected 2.2% month-on-month rise in consumer prices driven by higher fuel prices and back-to-school repricing.
JPM forecasts a 6% month-on-month rise in energy prices in September, with higher international oil prices pushing up gasoline, diesel and other fuel costs, but sees food inflation relatively contained at 0.9% m/m.
The bank also expects Turkey to remove the sliding-scale mechanism on gasoline and gradually phase out tax support for diesel.
JPM sees Turkey's headline inflation at 29.5% by year-end.
Turkey's interest rates are among the highest in the world but a cut would be in contrast to many other major economies which have begun raising them again in recent months.
The country's financial markets have also been buffeted in recent weeks by the liquidation of more than 130 investment funds at the centre of what the country's justice minister described as Ponzi-like "manipulative transactions".