Turkey's central bank made a sharp rate hike on Thursday to control inflation that is expected to approach 70% this year, according to Jinshi. The Monetary Policy Committee raised the benchmark interest rate from 30% to 35%, in line with market expectations. Turkish bank stocks continued to rise after the announcement of this decision, and the Turkish lira was trading basically flat. At a time when inflation is expected to slow from the second quarter of next year, higher interest rates are needed to attract foreign capital inflows into Turkey's local bond market. However, while the key interest rate has risen from 8.5%, official borrowing costs are still well below zero after adjusting for inflation. The central bank supplemented monetary policy tightening with other measures aimed at curbing domestic demand.