Turkish Borrowing Costs Continue Climb Amid Interest Rate Cut

The reduction of interest rates in Turkey is starting to backfire, as indicated by the continued growth in borrowing costs. TUR is down 1.84% premarket.

Bank loan rates have soared to as high as 35%, as reported by Union of Chambers and Commodity Exchanges President Rifat Hisarciklioglu.
The latest rates compare with the average of around 21% prior to the start of the easing cycle, based on central bank data.
Money managers believe the higher borrowing costs in the market are a natural outcome, as Turkey has given up on using its interest rate weapon.
The median estimate of inflation is expected to hit an annual 27.3% in December, marking a six-percentage point increase.
The 10-year government bond yields have climbed over seven percentage points to a record-high of 24.9%. It is ten percentage points over the benchmark repo.