{
  "title": "Perspectives on High Real Interest Rates in Turkey",
  "publication": "IMF Working Papers, October 1, 2008",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/31/perspectives-on-high-real-interest-rates-in-turkey-22433",
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  "summary": "The Turkish economy is typically characterized as having particularly high real interest rates. Fundamental considerations, such as high growth rates or high returns to capital, do not provide a satisfactory resolution of this puzzle.",
  "sections": [
    {
      "heading": "Key findings and puzzle",
      "content": "- The Turkish economy is typically characterized as having particularly high real interest rates.\n- Fundamental considerations, such as high growth rates or high returns to capital, do not provide a satisfactory resolution of this puzzle."
    },
    {
      "heading": "Main explanatory factors",
      "content": "- Doubts about the sustainability of disinflation have a significant impact on the level of real interest rates in Turkey.\n- The existence of a risk premium also has a significant impact on the level of real interest rates in Turkey.\n- Fiscal policy variables are shown to affect both doubts about disinflation sustainability and the risk premium."
    },
    {
      "heading": "Policy implications and recommendations",
      "content": "- A more credible and prudent fiscal policy can help reduce real interest rates in Turkey."
    },
    {
      "heading": "Subjects and keywords",
      "content": "- Subject: Exchange rate risk, Inflation, Interest rate parity, Real interest rates, Return on investment\n- Keywords: forward rate, inflation rate, risk premium, WP\n\n---\n\n Content in this bundle\n\n- wp08251\n  - wp08251 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - wp08251 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/perspectives-on-high-real-interest-rates-in-turkey-22433"
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    "[Markdown version](/en/publications/wp/issues/2016/12/31/perspectives-on-high-real-interest-rates-in-turkey-22433/index.md)",
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    "Authors: Prakash Kannan",
    "Published: October 1, 2008",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781451871098.001",
    "The Turkish economy is typically characterized as having particularly high real interest rates.",
    "Fundamental considerations, such as high growth rates or high returns to capital, do not provide a satisfactory resolution of this puzzle.",
    "Doubts about the sustainability of disinflation have a significant impact on the level of real interest rates in Turkey.",
    "The existence of a risk premium also has a significant impact on the level of real interest rates in Turkey.",
    "Fiscal policy variables are shown to affect both doubts about disinflation sustainability and the risk premium.",
    "A more credible and prudent fiscal policy can help reduce real interest rates in Turkey.",
    "Subject: Exchange rate risk, Inflation, Interest rate parity, Real interest rates, Return on investment",
    "Keywords: forward rate, inflation rate, risk premium, WP",
    "**_wp08251**"
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