Region fares well in Q2, Turkey to hike rates next week

Activity data released in Russia, Turkey and Poland suggest that regional GDP growth remained strong at around 4% y/y in Q2. Among a number of monetary policy decisions due next week, we expect Turkey’s central bank to hike interest rates by another 100bp. But if they don’t it would reignite concerns over the central bank’s independence and trigger a fresh sell-off in the lira.

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