Turkey's central bank again surprised markets with its decision on Thursday to cut its key interest rate even as inflation in the country soared above 80%.
The country's monetary policymakers opted for a 100 basis point cut, bringing its policy rate (one-week repo) down to 12% from 13%.
Turkey's inflation rate reached 80.2% in August, rising for the 15th month in a row and the highest level in 24 years.
Turkey also cut rates by 100 basis points last month and gradually cut interest rates by 500 points by the end of 2021 which has sparked the currency crisis.
According to a statement from the central bank, it has assessed that the updated policy level is adequate under the current outlook.
It also said the cuts were necessary as growth and demand continued to slow, while also underlining the growing geopolitical risks.
The country has adopted a different approach than others since last year as Turkish President Tayyip Erdogan considers lower rates the only way to curb soaring inflation.
However, the impact of inflation has soared more than four times over the past year.
