JPMorgan raises Turkey inflation forecast, expects 100 bps cut in November
LONDON, Oct 21 (Reuters) - Wall street bank JPMorgan said on Thursday it expected Turkey's central bank to trim interest rates by another 100 basis points (bps) in November and sharply raised its inflation forecast.
Turkey slashed its benchmark rate by a surprise 200 bps on Thursday despite stubbornly high inflation, pushing real interest rates deeper into negative territory and sending the lira to a fresh record low.
"Such front-loaded easing suggests that bringing down inflation in a rapid way is not a policy priority," JPMorgan's Yarkin Cebeci said in a note to clients.
"We fear this move will only strengthen the price pressures; we are revising our inflation forecasts to 19.9% for this year and to 16.4% in 2022."
JPMorgan had previously expected inflation to stand at 16.7% by end-2021. (Reporting by Karin Strohecker Editing by Chris Reese)
