Turkish central banker Erkan says country is determined to achieve disinflation

Turkey is committed to achieving disinflation, central bank chief Hafize Gaye Erkan told investors on Thursday while anticipating the completion of the monetary policy tightening cycle as soon as possible, two sources told Reuters.

Erkan, in New York for a day of presentations to foreign investors, said achieving disinflation is a measure of success and she is determined to achieve it, the meeting participants said.

Erkan told investors that Turkey will prudently continue to increase foreign exchange reserves and the process will be supported by accelerating capital inflows, the sources said.

Data released on Thursday by the Institute of International Finance showed foreign investors added some $5.4 billion in exposure to debt and equity portfolios in Turkey in the last two months of last year, the largest such inflow in five years.

Reuters reported last week that U.S. investment giants Pimco and Vanguard have returned to the Turkish market due to its newfound economic orthodoxy.

In June, President Tayyip Erdogan named a new cabinet and central bank chief. Erkan has since hiked rates by 3,400 basis points to 42.5% to rein-in inflation that neared 65% last month on an annualised basis.

The Turkish central bank did not immediately respond to a request for comment.

Reporting by Nevzat Devranoglu, additional reporting by Rodrigo Campos; editing by Chris Reese, Kirsten Donovan