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Western EuropeMay 4 2011

Uncertainty reigns as Turkey takes two-pronged monetary policy approach

Turkey’s central bank is attempting an unusual combination of tightening monetary policy using reserve requirements, while combating speculative inflows through interest rate cuts. But the outcome remains uncertain.
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Uncertainty reigns as Turkey takes two-pronged monetary policy approachDurmus Yilmaz, Turkish central bank governor

When Durmus Yilmaz hands over the reins as governor of the Central Bank of the Republic of Turkey (CBRT) to his deputy Erdem Basci after completing his five-year term in April 2011, he will leave behind a remarkable legacy.

Consumer price inflation, which surpassed 70% in 2001 and was still at 9.6% when Mr Yilmaz took charge in 2006, came in at just under 4% year on year for March 2011, the lowest rate in more than 40 years.

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