2.1.4. Conclusion

In short, accommodative monetary and fiscal policies of advanced economies following the global crisis had adverse effects on emerging economies at end-2010. Accordingly, the CBRT contemplated a new monetary policy approach, which was shaped to a great extent in 2011 and enriched by new policy instruments in 2012. This approach, which relies on a more flexible structure against possible shocks, reduced macro-financial risks by facilitating the balancing of internal and external demand. In this context, 2012 proved to be a year marked by a more evident economic stabilization and a steady decline in inflation, which were accompanied by growth in economic activity.

The CBRT will endeavor to preserve and further what was acquired so far through the policies to be implemented in 2013. Under the assumptions that import prices and the exchange rate volatility are low, no further deterioration occurs in the global economy and the fiscal discipline is maintained, inflation is expected to converge the target at end-2013. On the economic activity front, driven by both the accommodative monetary policy decisions taken as of mid-2012, and the improvement in foreign financing conditions, domestic demand is expected to follow a stable course of increase in the forthcoming period.