Central bank vows to step in to contain inflation

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Yellow cabs sit at a taxi rank near buildings decorated with Turkish national flags in Istanbul, Turkey, on Tuesday, July 19, 2016. 

Turkey’s central bank has promised to review monetary policy later this month, after data showed inflation had surged to its highest level in nearly 15 years.

In a statement likely to heighten expectations of a rate hike amid a currency crisis, the bank said Monday that action would be necessary to combat “significant risks to price stability.”

Turkey’s lira has lost around 40 percent of its value against the U.S. dollar so far this year, driving up the cost of basic domestic goods and prompting investor panic over the potential impact on the wider economy.

“Recent developments regarding the inflation outlook indicate significant risks to price stability. The central bank will take the necessary actions to support price stability,” the bank said.

“(The) monetary stance will be adjusted at the September monetary policy committee meeting in view of the latest developments,” it added.