Turkish Lira weakens against the U.S. dollar after the bank’s Monetary Policy Committee rate decision.

Last month, the bank reduced the policy rate from 18.00 percent to 16.00 last month.

“Despite the recovery in global economic activity in the first half of the year and the increase in the vaccination rate, new variants keep the downside risks to global economic activity alive. Recovery in global demand, high course of commodity prices, supply constraints in some sectors and rise in transportation costs have led to producer and consumer price increases internationally,” the bank said in a statement.

“Unfavorable effects of weather conditions in major agricultural commodity-exporting countries are observed on global food prices. While the effects of high global inflation on inflation expectations and international financial markets are closely monitored, central banks in advanced economies assess that the rise in inflation on the back of rising energy prices and imbalances between supply and demand may last longer than previously anticipated,” the bank added. (ILKHA)