I
II
Contents
Abstract ..................................................................................................................................................... 3
Introduction ............................................................................................................................................... 3
1-
2-
3-
Interest Rate – Exchange Rate ............................................................................................................... 6
1.1
2002 – 2008: Early Era.................................................................................................................. 6
1.2
2008 – 2010: World Economic Crisis ............................................................................................ 7
1.3
2010 – 2020: Post crisis to COVID-19........................................................................................... 8
1.4
2020 – 2024: COVID-19 to present .............................................................................................. 9
Interest Rate – Turkish Stock Market................................................................................................... 10
2.1
2002 – 2008: Early era................................................................................................................ 11
2.2
2008 – 2010: World economic crisis .......................................................................................... 12
2.3
2010 – 2020: Post crisis to COVID-19......................................................................................... 13
2.4
2020 – 2024: COVID-19 to present ............................................................................................ 14
Interest Rate – Consumer Price Index.................................................................................................. 15
3.1
2002 – 2008: Early era................................................................................................................ 16
3.2
2008 – 2010: World economic crisis .......................................................................................... 17
3.3
2010 – 2020: Post crisis to COVID-19......................................................................................... 18
3.4
2020 – 2024: COVID-19 to present ............................................................................................ 19
Conclusion ................................................................................................................................................... 20
References ................................................................................................................................................... 21
III
The Effects of Interest Rate Policy on the Exchange Rate,
Turkish Stock Market, and Consumer Price Index in Turkey
Abstract
This study explains to measure the effects of interest rate changes by Turkish Central Bank
(TCB) on the exchange rate, growth rate and consumer price index (CPI) in Turkey. The
study includes 2002-2023 period, which also known Justice and Development Party period.
Aim of the study is comparing interest rate – exchange rate, interest rate – Turkish stock
market and interest rate – CPI in order to find a positive, negative or neutral relationship
between them. Therefore, I expect to find fundamental relationships but also explain how
political decisions creates anomalies in the economy.
Keywords: Interest rate, consumer price index, exchange rate, stock markets
Introduction
The main missions of a central bank in a country is price stability, aiming the low inflation
rate as low as can be (Mishkin, 2016). Also, profitable growth and maintaining fiscal
stability are crucial pretensions in the broader profitable policy frame. For Turkey, the part
of the Turkish Central Bank (CBRT) in impacting macroeconomic pointers through
monetary policy opinions, particularly interest rate adjustments, has been a subject of
significant debate. By setting the standard interest rate, the CBRT seeks to impact
borrowing costs, consumption, and investment, which inclusively impact crucial economic
variables similar as inflation, exchange rates, and stock market performance( Kara, 2008).
Interest rate policy in Turkey has historically been shaped by the binary objects of
controlling inflation and stimulating economic growth. Still, achieving these goals
contemporaneously presents significant challenges, as high interest rates can suppress
inflation but may also hamper economic growth by increasing the cost of borrowing.
Again, low interest rates can stimulate growth and investment but may lead to higher
inflationary pressures and currency deprecation. The unique dynamics of Turkey’s
economy, characterized by ages of high inflation, exchange rate volatility, and political
interventions, make it an interesting case study for assaying the impacts of financial
policy( Başçı, 2012).
The period between 2002 and 2024, frequently referred to as the Justice and Development
Party (AKP) period, witnessed substantial economic transformations in Turkey (Uygur,
2010). During this time, the TCB’s interest rate opinions were constantly told by political
precedences, raising questions about the independence of the central bank (Binici &
Eryılmaz, 2019). Political leaders usually put growth and job creation ahead of controlling
inflation, which resulted in monetary policies that were not in line with conventional
wisdom. The exchange rate was significantly impacted by these schemes; portions of the
rapid-fire currency deprecation damaged investor confidence and raised import prices,
which in turn fueled inflation.
Interest rate policy has important counteraccusations for the Turkish stock request in
addition to its effect on the exchange rate. Lower interest rates generally make equities
more attractive by
IV
reducing the returns on fixed- income securities, thereby encouraging investment in stocks.
Still, in Turkey, the relationship between interest rates and stock request performance is
frequently complicated by macroeconomic inbalance and geopolitical pitfalls, which can
discourage foreign investment despite favorable financial conditions (Alper & Yılmaz, 2017).
This study will explore these relations to identify patterns and anomalies in stock market
behaviour in response to interest rate changes.
Another critical variable influenced by interest rate policy is the Consumer Price Index( CPI),
a crucial measure of affectation. High inflation has been a continuous challenge for Turkey,
eroding purchasing power and undermining profitable stability. By examining the
relationship between interest rates and CPI, this study aims to assess the effectiveness of the
TCB’s monetary policy in controlling inflation and identify implicit trade-offs with other
economic objects (Özdemir, 2018).
The findings of this study will contribute to the ongoing converse on monetary policy
effectiveness in emerging markets, offering precious lessons for policymakers and
economists. In the ensuing sections, the methodology and data sources will be outlined,
followed by an in-depth analysis of the results and their counteraccusations for Turkey’s
economic orbit.
Figure 1
Retrieved From: https://evds2.tcmb.gov.tr (Date of Access : 21.05.2025)
V
The graph illustrates the weighted average interest rates for Turkish Lira( TRY) deposits
across different majorities from November 1, 2002, to October 1, 2024. It highlights the
trends in interest rates for short- term deposits (up to 1 month, 3 months, and 6 months) as
well as longer-term deposits (up to 1 time and hereafter). The data shows a significant decline
in interest rates during the early 2000s, reflecting the economic stabilization programs
enforced after the 2001 financial crisis. This period of declining rates transitioned into a phase
of relative stability from 2005 to 2018, where interest rates changed within a narrower range.
Still, the graph also reveals a sharp upward trend starting in 2018, peaking dramatically in the
times following 2021. This trend aligns with periods of heightened inflationary pressure and
currency volatility, as the central bank increased interest rates to stabilize the economy and
challenge inflation.
The divergence between short-term and long-term interest rates is another notable point of the
graph. While short-term rates demonstrate greater tenderness to financial policy changes and
profitable events, long- term rates parade a further gradational adjustment. The overall
upward movement across all orders in recent years underscores the central bank’s response to
economic instability and external shocks, including the effects of the COVID- 19 epidemic.
This visual representation reinforces the critical part of interest rate policy in shaping
Turkey’s economic path and provides a base for farther analysis of its impact on
macroeconomic pointers similar as inflation, exchange rates, and stock market performance.
Figure 2
Retrieved From: https://evds2.tcmb.gov.tr (Date of Access : 21.05.2025)
This graph illustrates mean values of several deposit rates of the Figure 1.
VI
1- Interest Rate – Exchange Rate
The relationship between interest rates and exchange rates is a critical conception in Turkey’s
economic frame. Interest rates, set by the Central Bank of the Republic of Turkey( CBRT),
directly impact the cost of borrowing and the return on investments, making them a crucial
driver of capital inflows and outflows. The higher interest rates in Turkey, historically attract
foreign capital and strenghten the Turkish Lira with its increasing demand. On the other hand,
the lower interest rate policies especially with applying with unexpected monetary policies
like be seen in last years often caused sudden currency value depreciation. (Karagöl &
Yüzbaşıoğlu, 2017).
This situations, becomes more complicated with the factors like permanent current account
deficits, geographical uncertainities and inflation expectations in Turkey. Also, the
dependency of external debts and energy imports in Turkey made its economy more sensitive
to global economic conditions. To come to the point, the relationship between interest rates
and exchange rates in Turkey is not just complicated but have an important place for
protecting the macroeconomic stability and gaining investors trust.
1.1 2002 – 2008: Early Era
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VII
This graph, shows the relationship between USD/TL exchange rate and bank deposit interest
rates in the time between November 2002 and January 2008. This period, corresponds with
the first years of AKP Government in Turkey with its important money policy changes and
characterized economic reforms. As can be seen on graph, deposit interest rates starting from
a higher level. This situation reflects the occured risk premium after 2001 financial crisis.Over
time, interest rates steadily declined as the AKP government enforced stabilization programs
and economic growth. Meanwhile, the exchange rate also displayed a declining trend,
indicating an appreciation of the Turkish lira against the U.S. dollar, supported by advanced
investor confidence, privatization efforts, and significant inflows of foreign direct investment.
Between 2002 and 2008, the Turkish economy faced both chances and challenges.
Beforehand in this period, Turkey reaped the benefits of a strong recovery from the 2001
crisis, with structural reforms and tight fiscal policies leading to reduced inflation and stable
growth (Özatay, 2009). Yet, the global economic terrain become increasingly volatile in the
ultimate part of the period, particularly with the onset of the 2008 global financial crisis. This
external shock put pressure on emerging market currencies, including the Turkish lira, and
contributed to the exchange rate's volatility towards the end of the timeframe. Also, Turkey’s
reliance on external financing and the high current account deficiency remained fundamental
vulnerabilities during this period, which came more pronounced as global liquidity conditions
tensed. The interaction between decreasing interest rate and exchange rate stability reflects
the AKP's economic successes in the first year of its administration while structural risks
increasing.
1.2 2008 – 2010: World Economic Crisis
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VIII
This graph, includes the time between January 2008 and December 2010. Again it shows the
relationship between bank deposit interest rate and UST/TL exchange rate but different time
period from previous one. In this years, deposit interest rates decreased gradually because the
Central Bank Of Turkey took actions and eased the monetary policies in response to global
financial crisis. At the same period, the exchange rate flactuated and in 2008, the Turkish Lira
lose its value against U.S. dollat significantly because of the capital outflow and increased risk
aversions. As the global economic conditions became better and Turkey's economy recover,
the Turkish Lira started to gain its stability in 2009 and its value increased in 2010 even
though its not much.
The 2008-2010 years became a difficult period for Turkish Economy but it was
transformative. At first, the global financial crisis led to decrease in export, economic
recession and unemployment. But after a while, with strong domestic demand and
countercyclical monetary policies the Turkish economy recovered quickly relative to these
other countries.The Central Bank’s interest rate cuts were a key part of this strategy, aiming
to stimulate economic activity. Meanwhile, the exchange rate dynamics during this period
also reflected external factors, including fluctuations in global risk sentiment and the Federal
Reserve’s monetary policy. The period pointed Turkey's growing endurance but also exposed
vulnerabilities related to its reliance on external financing and the structural weaknesses in its
current account balance (Central Bank of the Republic of Turkey( CBRT), 2010).
1.3 2010 – 2020: Post crisis to COVID-19
Retrieved From: https://evds2.tcmb.gov.tr (Date of Access : 21.05.2025)
The graph depicts the relationship between deposit interest rates and the USD TRY exchange
rate from 2010 to 2020. The deposit interest rates showed periodic fluctuations, peaking
IX
during ages of economic instability, while the USD/TRY exchange rate displayed a steady
upward line, reflecting a nonstop deprecation of the Turkish lira against the U.S. dollar . The
sharp rise in the exchange rate post-2018 marks a significant economic event the 2018
Turkish currency crisis, affected by geopolitical pressures, declining investor confidence, and
a high current account deficiency (Yilmaz, 2020). The Central Bank's inconsistent monetary
policy responses during this period contributed to economic uncertainty, driving interest rate
volatility.
Throughout this decade, Turkey experienced plenty economic and political challenges. Early
in the decade, strong economic growth fueled by credit expansion masked underlying
vulnerabilities similar as reliance on external borrowing. But political instability, reduced
institutional independence, and global economic shifts began to weigh on the economy. The
2013 taper tantrum , regional geopolitical tensions, and simulated relations with major trading
partners further eroded confidence in the lira. The 2018 crisis marked a turning point, with
inflation surging and foreign reserves decreasing. The rising exchange rate applied pressure
on Turkey's external debt repayments, leading to sharp interest rate adjusments in 2018 and
further. When it comes 2020, Turkish economy faced with difficulties such as high inflation,
low reserves, weakening investor trust (CBRT, 2018; IMF, 2019).
1.4 2020 – 2024: COVID-19 to present
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X
This time, when we examine the same relationship between 2020 and 2024, we can see that in
this period, USD/TL exchange rate increased at a stabil rate. This shows that Turkish lira had
a constant value depreciation against U.S. dollar. Against this, debosit interest rates were
fluctuating.Especially in late 2021 and late 2023, the efforts to provide economic stability
against the increasing financial instability and increating inflation, showed its effect and it
increased sharply.
The dramatic increase in exchange rate, draws attention to the structural weaknesses of
Turkey's economy. This weaknesses, includes decreasing reserves, high external debts and
fluctuating money policies.
2- Interest Rate – Turkish Stock Market
The relationship between interest rates and the Turkish stock market is important side of the
country’s economic dynamics. Interest rates, determined by the Central Bank of the Republic
of Turkey (CBRT), directly impact borrowing costs for businesses and consumer spending,
which in turn affect corporate profitability and stock market performance. Lower interest
rates generally encourage borrowing and investment, driving up stock prices, as seen during
periods of monetary easing (Chen, Roll, & Ross, 1986). Again, more interest rates increase
financing costs and reduce disposable income, frequently leading to weaker stock market
performance.
In Turkey, this relationship is farther influenced by factors similar as high inflation, political
uncertainity, and foreign investor sentiment. Times of aggressive rate cuts have occasionally
boosted the stock market in the short term but raised worries about long - term economic
stability. Also, fluctuations in the exchange rate, frequently tied to interest rate opinions, can
affect the stock market, especially for companies relying on import or foreign currency debt.
Thus, the interaction between interest rates and the Turkish stock market is a complex but one
of the key indicator of broader economic health( Akar, 2021).
XI
2.1 2002 – 2008: Early era
Retrieved From: https://evds2.tcmb.gov.tr (Date of Access : 21.05.2025 )
The graph compares the average deposit interest rates and the BIST 100 closing price index
between November 2002 and January 2008, capturing the economic change during the AKP's
early years. Deposit interest rates sharply declined from roughly 50% to below 20%,
reflecting the success of anti-inflationary measures, financial discipline, and financial
stabilization following the 2001 economic crisis. This period marked a shift toward lower
borrowing costs and much more stability, driven by structural reforms and enhanced investor
confidence.
Conversely, the BIST 100 index showed a steep rise, increasing from a level near 1 to over
6, signaling strong performance in Turkey's equity markets. The pushing factors of this
growth were the convenient global liquidite conditions, customization attempts and the AKP
government's pro-market policies that attract both foreign and domestic investment. The
inverse relationship of interest rates and stock market, implies the transition from high
return saving environment to a structure that supports capital market's improvement. This
period, reflects the financial market's expansion and its increasing diversification.
XII
2.2 2008 – 2010: World economic crisis
Retrieved From: https://evds2.tcmb.gov.tr (Date of Access : 21.05.2025 )
This graph shows the relationship between BIST 100 closing index and average deposit
interest rates that representing the period that implying the global financial crisis come to an
end. At the beginning, the deposit interest rates that stays on the 17,5% level, sharply
decreased in the middle of 2008's and when we come to late 2009 it was retreated to 7,5%.
This decline, reflects the CBRT's policies that stimulate the economic activities and strong
expanding of monetary systems.
On the other hand, The BIST 100 index showed an important recovery after its decline in the
crisis period. The index was near the level of 2 in 2009 and when it comes to late 2010's it
came on the level 6 and highlighted an general economic recovery and investors increasing
encourage for taking risks. This period shows that how Turkey's financial market is resistant.
At the end, it represents that applied policy measure's supportive side.
XIII
2.3 2010 – 2020: Post crisis to COVID-19
Retrieved From: https://evds2.tcmb.gov.tr (Date of Access : 21.05.2025 )
This chart, shows the BIST index relationship with average deposit interest rates but in time
between 2011 and 2020. In this period, Turkey's political en economic situation was very
complicated and filled with chaos. The deposit interest rates was not fluctated and pretty
stable in 2018, so that it was between 6% and 8%. After 2018 it increased to 12% and
decreased again at late 2019's. This increases, reflects the changes in monetary policies in the
time of increasing inflation after 2018 Turkey debt and currency crisis and the depreciation of
currency.
In the same period the BIST 100 index trending upward but not regularly. In 2011, it was
close to the level of 10 and it peaked till 2018 with the level of 20 but it has decreased at the
following years.The performance of the stock market was affected by global liquidity
conditions, domestic political developments, and structural economic challenges (Alper &
Yılmaz, 2017). Important events during this period included the 2013 Gezi Park protests, the
2016 attempted coup, and the growing pressures with international requests. The divergence
and volatility in the graph highlight the interplay between financial policy, investor
sentiment, and external shocks
XIV
2.4 2020 – 2024: COVID-19 to present
Retrieved From: https://evds2.tcmb.gov.tr (Date of Access : 21.05.2025 )
This graph shows the average deposit interest rates and the BIST 100 closing price index in
Turkey between 2020 and 2024. During this period, the Turkish economy passed significant
political and economic developments under the rule of the Justice and Development Party
(AKP).
In 2020, among the global COVID- 19 epidemic, Turkey enforced expansionary monetary
policies, leading to fairly low interest rates. This is reflected in the flat trend of deposit rates.
Simultaneously, the BIST 100 index started to recover due to increased liquidity and global
market trends. By 2021, inflationary pressures began increasing, forcing the Central Bank of
Turkey to raise interest rates for a short time, although these increases were limited compared
to inflationary requirements. This period also saw political interventions in monetary policy,
as the AKP replaced several Central Bank governors, contributing to market instability.
From late 2022 to 2024, the graph indicates a surge in the BIST 100 index and a gradational
increase in deposit interest rates. The rally in the BIST 100 may reflect academic investment
amid currency deprecation and limited domestic investment options, while the progressive
rise in
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interest rates are a sign of patient inflation initiatives. This developments, happened in a
environment that AKP government heavily criticized because of its monetary policies and
external shocks.
3- Interest Rate – Consumer Price Index
The relationship between Consumer Price İndex and interest rate, shows a critical balance
between monetary policies and inflation control. CRPT, sets the interest rates which is a
important tool to control inflation because higher interest rates have a tendency to deterrence
the borrowing and consumer spending and this limits the demand driven price increases. On
the other hand, low interest rates have a potential to revive the economic activities. But
considering the Turkey's fundamental economic problems and continuous price pressurs, it
results with higher inflation rate.
This relationship becomes more complicated because of elements like flactuations in
exchange rates. The surging exchange rate, is one of the main reasons of inflation because it
affects import directly. The interest rate reductions against the inflation rates that already
higher, has worsened the price increases and weakened the households purchasing power.
This interaction tooks into account the wide range effects of growth and financial markets
while remind us that its a very hard and sensitive mission to harmonize the interest rate
policies and inflation control to make economy more stable. (Kaya, Cıtcı & Dede, 2023).
XVI
3.1 2002 – 2008: Early era
Retrieved From: https://evds2.tcmb.gov.tr (Date of Access : 21.05.2025 )
This graph, compares the inflation rates of Consumer Price Index and average deposit interest
rate from 2002 to 2008 (The first years of AKP government). It shows the notable decline of
inflation and interest rates and this situation is consistent with the government's goal of
stabilizing the economy.
In this period, there is more compherensive economic reforms thanks to the guidance of IMF
(With its strict monetary programs.). The AKP government that came into power in 2002,
were planning to stabilize Turkish Lira, encourage the foreign investment and reduce the
inflation. With these goals, the government reduce the inflation rate to single digits from 30%
in 2004. The deposit interest rate decreased with the expectations of stabilizing inflation.
These events, and convenient economic conditions, increased the investments courage and
supported economic growth. (Uygur, 2010).
XVII
3.2 2008 – 2010: World economic crisis
Retrieved From: https://evds2.tcmb.gov.tr (Date of Access : 21.05.2025 )
This graph, shows the relationship between Inflation in Turkey and deposit interest rates in
2008-2010. This time period affected from global financial crisis significantly. The crisis that
starts on 2008, cause to contradiction in global trade and economic activities and led to
distruption in world markets. With the sharp contraction in Turkey and with the effect of
global recession, initial inflation rate declined rapidly in 2009.
This disposition, also reflected to the deposit interest rates. The interest rates that reached
higher levels in late 2008, decreased sharply in 2009 and as of 2010 it stabilized at lower
levels.The Central Bank of Turkey acknowledged aggressive monetary easing policies to
withstand with the economic slowdown, reducing interest rates to stimulate credit and
investment (Aysan & Yücel, 2011). The AKP government also implemented various fiscal
measures to support growth, including infrastructure investments and incentives for key
industries (Alper & Hatipoğlu, 2010).
This period demonstrated the relative adaptivity of Turkey’s economy, backed by structural
reforms accepted before in the AKP's tenure. These reforms included stronger banking
XVIII
regulations, which helped Turkey avoid a banking crisis during the global chaos.The crisis
exposed underpinning vulnerabilities, similar as Turkey's dependence on foreign capital and
its current account deficiency, which came as difficult challenges in the following years. By
2010, inflation and interest rates remained restrained, signaling partial stabilization but also a
slower recovery compared to earlier growth periods.
3.3 2010 – 2020: Post crisis to COVID-19
Retrieved From: https://evds2.tcmb.gov.tr (Date of Access : 21.05.2025 )
This graph, compares the inflation and deposit interest rates between 2010 and 2020. In this
period, there were important changes in politic and economic structures under the AKP
government. According to trends, inflation rate relatively low and stabilized in the first period
of this 10 year. But In the late times of this period, it headed to sharp increase.
Between 2010 and 2016 the inflation rate and interest rate stayed around single digit
numbers. The effective and strong domestic consumption and foreign capital inflows,
contributed the economy with letting it to grow more stable.
XIX
From 2013, the political events like Gezi Parkı protests and corruption allegations increased
the tension and it reduce the investors willingness to invest. The coup attempt in 2016
increased the uncertainity more and this situation caused to capital outflows and financial
inbalances. Despite all these events and outcomes, the government was able to hold control of
the inflation and interest rate at some point thanks to the CBRT's precautions.
This graph shows that the inflation and interest rate was increased remarkbly in 2016 and this
increase reached its highest level in 2018. High external debt, geoghraphical tensions and the
insistence of AKP government for not letting go the lower interest policies despite increasing
inflation, was key reasons for this situation to get worse. Also in this period, the Central
Bank's independency was damaged and it created a political intervention perception on
investors. Despite the decreasing inflation in the 2020's, Turkey's Economy remained fragile
and the problems like high unemployment rate, the dependency on short-term external
financing remain on the ground.
3.4 2020 – 2024: COVID-19 to present
Retrieved From: https://evds2.tcmb.gov.tr (Date of Access : 21.05.2025 )
This graph shows the relationship between inflation and deposit interest rates in Turkey from
2020 to 2024, a period marked by significant economic turbulence and policy shifts under the
AKP government.
XX
In the early stages, inflation and interest rates remained relatively low as Turkey, like much of
the world, dealt with the COVID- 19 pandemic. The economic slowdown caused by
pandemic led to an initial easing of monetary policy, with interest rates being kept low to
support economic recovery. After that, starting in 2021, inflation began to flactuate due to
global suplly chain problems, rising energy prices, and a cheapening Turkish lira. Despite
these pressures, the government pursued an unconventional monetary policy, cutting interest
rates even as inflation accelerated, in line with President Erdogan’s belief that lower interest
rates combat inflation.This approach boosted the deprecation of the lira and fueled farther
inflation (IMF, 2023).
The graph shows inflation peaking dramatically in 2022, coinciding with the lira’s sharp
decline and the broader global impact of the Russia-Ukraine war, which drove up commodity
prices, particularly energy and food. Meanwhile, interest rates remained comparatively lower,
lagging inflation throughout this period. By 2023, inflation began to moderate kindly due to a
base effect and compressed monetary policies as Turkey’s new economic team gestured a
shift toward further orthodox strategies after the general choices. By late 2023 and early
2024, interest rates had risen sharply as the Central Bank worked to stabilize the economy
and win back investor confidence.
Throughout this time, Turkey faced with serious economic problems like high external debt,
the continuous fluctuation of exchange rate and the difficulties of creating a balance between
the macroeconomic stability and growth.
Conclusion
In this study, we examined the Turkey's interest rate policies in 2002-2024. This study shows
that there is a complicated relationship such as the relationship between monetary policies
and inflation, stock market and exchange rate. Inflation control, the interest rate policies that
reflects the difficulties of efforts to stabilize the exchange rate and economic growth, played a
crucial role in this period.
This findings shows that, in economic reform periods, higher interest rates attracts foreign
investments and this led to short-term exchange rate stabilization and stock market growth.
But political pressures, causes to sudden and frequent interest rate declines and increase the
exchange rate depreciation and inflationist oppressions. This changes became more evident in
2018 currency crisis and COVİD-19 recovery process and has revealed that Turkey's economy
became more fragile to inconsistent political decisions and external shocks.
The relationship between interest rates and inflation, also shows that The Central Bank of
Turkey's has a lot of difficulties at maintaining price stability. The low interest rate periods
with the purpose of stimulate the economy, increased the price of the imported goods and
reduced the investors trust about making investment to Turkey and these situations resulted
with high inflation. This findings conclude that monetary policie's management need to be
balanced and carefully applied.
As a result, this study, emphasize the needing for more independence monetary policy for
providing more compatible and more balanced economy in Turkey. The financial structure
problems like dependency on external financing and pressures in economy need to be more
XXI
addressed. Because finding a solution for these problems have a crucial meaning for longterm growth. The future policies needs to prioritize transparency, instutional independency
and the balance between inflation and growth. This appproaches, will support to get
macroeconomic stability and regain the investors confidence on Turkey. (Başçı, 2012).
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