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Global markets react to US inflation and shifting interest rate trends
Global financial markets are reacting to significant shifts in inflation and interest rate expectations. In the United States, August Consumer Price Index (CPI) data showed inflation rising 0.4% monthly and 3.4% annually. Core inflation, excluding food and energy, rose 0.3% monthly, exceeding expectations. These figures have bolstered expectations for Federal Reserve action, with market probabilities for a 25 basis point rate hike reaching approximately 90%. TD Securities strategists have adjusted their outlook, now forecasting three interest rate hikes starting in September.
In Turkey, the Central Bank has maintained the policy rate at 37%. However, recent data shows a divergence between deposit and loan rates. Average interest rates for 1-3 month maturity TL deposits fell to 37.3%, a level not seen since 2023. Conversely, consumer loan interest rates have risen to 49.8%. Morgan Stanley suggests the Central Bank of the Republic of Turkey may have room for 250 basis points of interest rate cuts by the end of the year as economic conditions evolve.
Commodity markets have also experienced volatility. Brent crude oil prices rose 8.5% during the week, reaching 104.5 dollars per barrel, driven by geopolitical tensions in the Middle East. Precious metals like gold and silver saw significant movement following the US inflation data, with gold prices testing higher levels.
Entities
Central Bank of the Republic of Turkey · Central Bank of the Republic of Türkiye · Euro · European Central Bank · Federal Reserve · Kevin Warsh · Morgan Stanley · TD Securities · Turkey · Turkish Lira · United States
Claims
What the coverage asserts, and how many sources carry each claim.
- [● 2 SOURCES] Brent crude oil prices increased by 8.5% during the week, reaching 104.5 dollars per barrel. www.dunya.com
- [● 2 SOURCES] The average interest rate for consumer loans rose to 49.8% as of September 4. www.bolutakip.com · www.hamlegazetesi.com.tr
- [○ 1 SOURCE] Morgan Stanley estimates the Central Bank of the Republic of Turkey has room for 250 basis points of interest rate cuts by year-end. www.yenicaggazetesi.com
- [● 2 SOURCES] The average interest rate for 1-3 month maturity TL deposits fell to 37.3% in the week of September 4. www.bolutakip.com · www.hamlegazetesi.com.tr
- [○ 1 SOURCE] TD Securities strategists now expect three interest rate hikes from the Fed, starting in September.
- [● 2 SOURCES] Gold spot prices rose above 4,390 dollars following US inflation data. www.guvengazetesi.com.tr · www.merhabahaber.com
- [● 2 SOURCES] The probability of a 25 basis point interest rate hike by the Federal Reserve reached approximately 90%. paratic.com · www.dunya.com
- [● 6 SOURCES] US inflation rose 0.4% monthly and 3.4% annually in August. www.guvengazetesi.com.tr · www.merhabahaber.com · paratic.com · www.dunya.com · www.borsagundem.com.tr
- [● 3 SOURCES] US core inflation rose 0.3% monthly, exceeding expectations by 0.1 percentage points. www.borsagundem.com.tr · paratic.com · www.dunya.com
- [○ 1 SOURCE] Brent crude oil prices increased by 8.5% during the week. www.dunya.com
- [○ 1 SOURCE] Average consumer loan interest rates rose to 49.8% as of September 4. www.bolutakip.com