Turkey's 2023-2024 pivot to orthodox policy
After Erdoğan's re-election, the central bank under new governor Hafize Gaye Erkan hiked rates from 8.5% to 50% in nine months, reversing years of low-rate policy. Finance Minister Mehmet Şimşek led the shift toward orthodox economics.
Inflation peaked above 75% in mid-2024 before beginning a steady decline.
The program restored some credibility but left inflation expectations unanchored.
The current easing cycle is the next phase of this program — the bank is now unwinding the tight policy it built in 2023-2024.
