ISTANBUL (AP) — Turkey’s central bank raised its key interest rate by 3.5 percentage points on Thursday, halting a three‑month easing streak as it confronts stubborn inflation, financial turbulence following the arrest of Istanbul’s mayor and aftershocks of global tariffs.
The Monetary Policy Committee lifted the benchmark one‑week repo rate to 46% from 42.5% and pushed the overnight lending and borrowing rates to 49% and 44.5%, respectively.
The committee said the “tight monetary policy stance will be maintained until a permanent decrease in inflation and price stability are achieved.”
“The main trend in inflation declined in March,” the committee noted, but warned that core goods inflation is likely to rise slightly in April “due to developments in financial markets,” while services inflation should remain flat.
It added that growing protectionism in global trade, referring to the aftermath of global retaliatory tariffs, could undercut Turkey’s disinflation path by affecting commodity prices and capital flows.
Iris Cibre, a financial markets expert, called the decision “very positive” for the bank’s credibility, which experts criticized in the past for being open to political interventions in its decision making.
“There were some comments that such a thing would not be allowed politically. The Central Bank has refuted these comments. This is very positive in terms of the credibility of the Central Bank.”
Cibre said the hike showed policymakers can act “more freely politically,” even though Turkey’s President Recep Tayyip Erdogan has long favored lower borrowing costs. “We all know that politics is in favor of lowering interest rates,” she said but warned of further financial risks due to limited credits,
“There is a 2% credit growth limit. So, it will continue to create serious problems for companies. This will increase unemployment, and it seems like the economy will slow down for longer than expected.”
Cibre noted that U.S. Federal Reserve officials have hinted they will wait to see the full impact of recently announced retaliatory tariffs between the U.S and other countries before adjusting rates. “That’s exactly what our Central Bank emphasizes,” she said.
High inflation in Turkey has been attributed to a combination of factors, including rising energy prices, the economic fallout from the COVID-19 pandemic, and Erdogan’s past unconventional economic policy of lowering interest rates despite soaring inflation.
Erdogan has long argued that high interest rates cause inflation — a theory that runs against mainstream economic theory.
In 2023, Erdogan appointed a new economic team, signaling a shift away from his previous unorthodox policies. The team initially implemented a series of interest rate hikes to combat inflation. After maintaining the interest rate at 50% for several months, the bank had embarked on a gradual cycle of rate cuts until today.
This story corrects credit growth limit cited by Cibre to 2%.
Workers deliver goods to a shop at Eminonu commercial district in Istanbul, Turkey, Thursday, April 17, 2025. (AP Photo/Francisco Seco)
A man pulls a trolley with goods at Eminonu commercial district in Istanbul, Turkey, Thursday, April 17, 2025. (AP Photo/Francisco Seco)
People carry goods at Eminonu commercial district, in Istanbul, Turkey, Thursday, April 17, 2025. (AP Photo/Francisco Seco)
Australia’s most decorated living war veteran Ben Roberts-Smith on Friday lost his appeal of a civil court ruling that blamed him for unlawfully killing four unarmed Afghans. Meanwhile a veterans’ advocate called on prosecutors to speed up their investigations of war crime allegations in Afghanistan that have left innocent soldiers under a cloud of suspicion.
Three federal court judges unanimously rejected his appeal of a judge’s ruling in 2023 that Roberts-Smith was not defamed by newspaper articles published in 2018 that accused him of a range of war crimes.
Justice Anthony Besanko had ruled that the accusations were substantially true to a civil standard and Roberts-Smith was responsible for four of the six unlawful deaths of noncombatants he had been accused of.
Roberts-Smith later said he would immediately seek to appeal the decision in the High Court, his final appeal option.
“I continue to maintain my innocence and deny these egregious, spiteful allegations,” Roberts-Smith said in a statement.
“Sunlight is said to be the best disinfectant, and I believe one day soon the truth will prevail,” he added.
Tory Maguire, an executive of Nine Entertainment that published the articles Roberts-Smith claimed were untrue, welcomed the ruling as an “emphatic win.”
“Today is also a great day for investigative journalism and underscores why it remains highly valued by the Australian people,” Maguire said.
The marathon 110-day trial is estimated to have cost 25 million Australian dollars ($16 million) in legal fees that Roberts-Smith will likely be liable to pay.
Roberts-Smith has been financially supported by Australian billionaire Kerry Stokes whose media business Seven West Media is a rival of Nine Entertainment.
Reporter Nick McKenzie, who was personally sued, said Roberts-Smith must be held accountable before the criminal justice system.
Roberts-Smith has never faced criminal charges, which must be proven to the higher standard of beyond reasonable doubt.
Only one Australian veteran of the Afghanistan campaign has been charged with a war crime, former Special Air Service Regiment soldier Oliver Schulz.
Schulz has been charged with murdering an unarmed Afghan, Dad Mohammad, in May 2012 by shooting him three time as the alleged victim, aged in his mid-20s, lay on his back in long grass in Uruzgan province.
Schulz was charged in March 2023. He has pleaded not guilty but has yet to stand trial. Schulz is currently taking part in a committal hearing that will decide whether prosecutors have sufficient evidence to warrant a jury trial.
An Australian military report released in 2020 found evidence that Australian troops unlawfully killed 39 Afghan prisoners and civilians. The report recommended 19 current and former soldiers face criminal investigation. It’s not clear whether Roberts-Smith was one of them.
Police are working with the Office of the Special Investigator, an Australian investigation agency established in 2021, to build cases against elite SAS and Commando Regiments troops who served in Afghanistan between 2005 and 2016.
The Australian Special Air Service Association, which advocates for veterans, has called for the government to establish a time limit for the Office of the Special Investigator rather than allow the allegations to drag on for decades.
“The whole process of dealing with these allegations needs to be completed at best speed,” the association’s chairman Martin Hamilton-Smith said.
The single criminal charge laid so far suggested that evidence behind many allegations was not credible, he said.
Defense Minister Richard Marles, who is acting prime minister in Anthony Albanese’s absence, did not immediately respond on Friday to a request for comment.
Rights activists have noted that the only Australian to be jailed in relation to war crimes in Afghanistan is whistleblower David McBride.
The former army lawyer was sentenced a year ago to almost six years in prison for leaking to the media classified information that exposed allegations of Australian war crimes.
Roberts-Smith, 46, is a former SAS corporal who was awarded the Victoria Cross and Medal for Gallantry for his service in Afghanistan. Around 39,000 Australians soldiers served in Afghanistan and 41 were killed.
His SAS colleagues are among those calling for him to become the first of Australia’s Victoria Cross winners to be stripped of the highest award for gallantry in battle.
FILE - Ben Roberts-Smith arrives at the Federal Court in Sydney, Australia, Wednesday, June 9, 2021. (AP Photo/Rick Rycroft, File)
