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PREVIEW-Turkish central bank seen hiking rates 50 bps
By Reuters India

A poll of 10 economists sees the Turkish central bank hiking rates 50 basis points

* Bank seen sticking to a hawkish line, and signalling more tightening ahead * Central bank rate decision due at 1600 GMT on Thursday

By Emma Ross-Thomas

ISTANBUL, May 14 (Reuters) - Turkey's central bank, facing rising inflation and uncertainty over whether the government will heed its calls for fiscal discipline, is expected to raise interest rates on Thursday and signal another hike ahead.

Thursday's monetary policy committee meeting comes amid reports of increased tension between the government and the inflation-fighting central bank. But economists expect the bank to stick to its habitual calls for fiscal discipline on Thursday rather than toughening its stance.

A Reuters poll of 10 economists on Wednesday showed all but one expected a 50 basis point increase to the 15.25 percent benchmark rate. One bank forecast a 100 basis point increase, in what would be the first hike since 2006 and would reverse a six month easing cycle running from September to February.

In April, the central bank revised up its 2009 inflation forecast to 4.9-8.5 percent from a previous range of 1.8-5.5 and said its estimates were based on a scenario of gradual rate hikes until the middle of the year.

Since then, inflation expectations have deteriorated sharply as the bank's latest external expectation survey showed inflation was seen ending the year at 9.55 percent, up from 8.44 percent just two weeks before.

 
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