and the foreign exchange liquidity facility of the central bank. on the contrary, the banking system should use risk management principles effectively. annex : calendar for 2008 mpc meeting dates 17 january, thursday inflation report financial stability report 31 january, thursday 14 february, thursday 19 march, wednesday 17 april, thursday 30 april, wednesday 15 may, thursday 30 may, friday 16 june, monday 17 july, thursday 28 july, monday 14 august, thursday 18 september, thursday 22 october, wednesday 19 november, wednesday 31 october, friday 28 november, friday 18 december, thursday

durmus yilmaz : turkey ’ s monetary and exchange rate policy for 2008 speech by mr durmus yilmaz, governor of the central bank of the republic of turkey, at the central bank of the republic of turkey, ankara, 18 december 2007. * * * general framework of the monetary policy overview of 2007 the central bank of the republic of turkey ( the central bank ) has continued to implement the monetary policy in 2007 based on the principles of inflation targeting regime. the monetary policy committee ( the committee ) meetings were held in line with the preannounced annual timetable. interest rate decisions were made public through press releases on the same day along with the rationale of decisions. moreover, “ summary of the monetary policy committee meeting ” including details of decisions and the assessments made during the meetings started to be published along with the english translation within eight working days following the meetings in 2007. inflation report, which is the main communication tool of the central bank, continued to be published quarterly. furthermore, in order to increase the efficiency in management of expectations, price developments report was also published within a very short time with a detailed analysis of inflation data following the announcement of monthly price developments. inflation in the first quarter of 2007, as foreseen, remained within the uncertainty band set around the path consistent with the target, whereas the decline in inflation stagnated in the last quarter due to both considerable increases in food prices, arising from drought as well as global conjuncture, and adjustments in administered prices. thus, it has become obvious that the year - end inflation would remain outside the uncertainty band. though the central bank has targeted the cpi inflation, it has pursued an effective communication strategy by referring to core measures at times of price movements beyond its control and pursued an effective communication strategy. in line with the positive outlook of inflation trend in prices excluding energy, food and administered prices, a measured rate cut cycle has been initiated in september 2007. accordingly, the overnight borrowing rate was decreased by 175 basis points in total until the end of 2007, from 17. 50 percent to 15. 75 percent. the central bank has made significant progress over the last two years in terms of communication policy, transparency and accountability. despite the fact that inflation remained above the path consistent with the target due to a series of supply - side shocks over the past two years, the inflation expectations for the next 12 and 24 months indicate low levels such as 6. 1 and 5. 2 percent, which have not