Important Warning: Be Mindful of Interest Rates in Your Bank Accounts
High interest rates continue to drive banks’ appetite for deposits, despite a drop in inflation rates. The Central Bank’s policy interest currently stands at 50 percent, while annual inflation fell to 49.38 percent in September.
During this period, the stock market faced a significant downturn, but exchange rates remained stable. The US Federal Reserve’s decision to cut interest rates led to a rise in gold prices, enticing investors and marking the beginning of a real return period for deposit interest rates.
Weighted averages in banks show that deposit interest rates are currently higher than inflation, making deposits an attractive option for savers. The question now is, will the appeal of deposits continue to rise in the future? Will interest rates see further increases? And how much can a person earn monthly with 1 million liras?
According to Sworn-in Certified Public Accountant Ahmet Kurtuluş, the downward trend in annual inflation is expected to persist. While the inflation target for 2024 was raised to 41.5%, it is anticipated that inflation will not exceed 45%. As inflation continues to decline, interest rate cuts are forecasted to begin next month.
Kurtuluş suggests that interest rates on short-term deposits are currently in the 52-54 percent range, but this rate drops to 48-50 percent in the long term. If the Central Bank decides to reduce interest rates in November, a decrease in deposit rates can be expected. This might mark the end of high interest rate periods, as interest rate reductions are likely to continue throughout 2025.
Currently, a saver depositing 1 million TL in a time deposit can expect a monthly net return between 42,054 TL and 43,672 TL. As the maturity lengthens, interest rates decrease, resulting in a lower monthly income amount.
Looking ahead, gold and deposit investments are anticipated to yield healthy returns in the short term, with the stock market and other capital market instruments potentially offering higher returns as interest rate cuts unfold. Investors are advised to keep an eye on market developments and adjust their investment strategies accordingly.
