In a statement released following the Monetary Policy Committee meeting, the central bank acknowledged a slight increase in the underlying trend of monthly inflation in July but emphasized that domestic demand continues to weaken, curbing inflationary pressures. While goods prices are declining, the bank expressed concerns over the persistent high levels of services inflation, inflation expectations, and geopolitical risks.
The CBRT reiterated its commitment to a tight monetary stance until a significant and sustained decline in inflation is observed and inflation expectations align with the bank's projections. To support the monetary transmission mechanism, the central bank indicated its readiness to implement additional macroprudential measures if necessary.
The bank emphasized its focus on closely monitoring inflation indicators and pledged to use all available tools to achieve its 5 percent inflation target in the medium term.
The decision to hold the interest rate steady comes as the central bank balances the need to combat inflation with the desire to support economic growth. (ILKHA)