ANKARA

The Central Bank of Türkiye on Thursday hiked its policy rate by 500 basis points to 40%, much more than market forecasts.

Economists polled by Anadolu survey last week expected the bank would deliver a 250 basis points rate hike.

The bank stressed that the current level of monetary tightness is significantly close to the level required to establish the disinflation course.

"Accordingly, the pace of monetary tightening will slow down and the tightening cycle will be completed in a short period of time," it said.

According to the latest data from TurkStat, Türkiye's annual inflation eased to 61.36% in October, from a nine-month high of 61.53% in September.

At its October meeting, the bank increased its policy interest rate, also known as the one-week repo auction rate, by 500 basis points to 35%.

Over the course of six monetary policy meetings, the bank has been gradually increasing the rate from 8.5% in May.