The largest Turkey ETF led the charge Wednesday after Turkey’s central bank left its benchmark interest rates unchanged, easing concerns that it would loosen its monetary policy in face of declining inflationary pressures and a stronger lira currency.

The iShares MSCI Turkey ETF (NasdaqGM: TUR) was among the best performing non-leveraged ETFs on Wednesday, jumping 5.1% and breaking back above its short-term resistance at the 50-day simple moving average.

Turkey’s central bank

Some market observers speculated Turkey’s central bank would cut rates given the lower inflation levels as investors also saw the potential for political pressure for lower rates before the March local elections, Reuters reports.

“While developments in import prices and domestic demand conditions have led to some improvement in the inflation outlook, risks on price stability continue to prevail,” the bank said in a statement, adding it decided to maintain the tight policy stance until the inflation outlook displayed a significant improvement.

The lira currency appreciated 1.9% against the U.S. dollar to TRY5.3457 Wednesday on the decision to keep rates steady.

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