Turkey leaves rates unchanged as inflation and security costs weigh on economy

Turkey’s central bank kept its main interest rate at 45% on Thursday, signaling that policymakers remain focused on fighting inflation even as economic pressures intensify. The decision came amid concerns that persistent price growth is still squeezing households and businesses across the country.

Officials also pointed to rising costs linked to military activity in northern Syria and Iraq, adding another strain to public finances. Those security operations have become part of a broader fiscal challenge for Ankara, which is trying to balance defense spending with efforts to stabilize the economy.

The rate hold suggests the central bank is taking a cautious approach after a period of aggressive monetary tightening. While higher borrowing costs can help cool inflation, they also make credit more expensive for consumers and companies already dealing with weaker purchasing power.

For many Turks, the policy mix means continued pressure on daily life as inflation remains elevated and growth faces fresh headwinds. The central bank’s next moves will be closely watched for signs of whether it can bring prices under control without deepening the economic strain.