The Central Bank of Turkey just cut the interest rate to 38%.

What does Professor Selva Demiralp think? She has an interesting take: if after this rate cut, market interest rates also decline, it means everyone truly believes in the Central Bank's narrative. In other words, the credibility of the Central Bank depends on whether the market accepts it—numbers will tell the story.

The key now is how the market moves in the coming days. If yields on various assets start to loosen, then the Central Bank's move is considered correct; if the market remains indifferent or even reacts in the opposite direction, it indicates that investors are not buying into it at all. The transmission mechanism of monetary policy ultimately relies on market sentiment.