The Istanbul share index rose 1.25% to 62,553.32 points, outperforming the wider emerging markets index, which was up 0.39%.
Latest in Tag: Lira Highlight
Latest in Tag: Lira
The bank also raised its outlook for inflation.
The lira rallied slightly shortly after the announcement.
The lira weakened beyond 2.33 to the dollar, meaning Turks now need more than twice as many lira to buy dollars as they did at the currency’s peak six years ago, a costly decline in a nation heavily dependent on imports.
The central bank released its survey of expectations of business leaders’ and economists on Friday, which showed they see inflation accelerating, but market players worry even this will not trigger policy action from the central bank ahead of elections.
Erdogan said he could freeze the legislation if the opposition instead agreed to consider judicial reforms as part of changes to the constitution, although his exact proposals are unclear.
The market also awaited the central bank’s announcement of its 2014 monetary and exchange rate policy report on Tuesday, in which it will provide guidance after the Fed decision.
The lira touched 2.0839 to the dollar before climbing back to 2.0696, from 2.0580 at Wednesday’s close.