Neo-fisher effect and application in Türkiye

The aim of this study is to examine the causality relationship between interest and inflation, which is frequently found in the economic literature, for the Turkish economy in the light of current data. In other words, the main subject of the study is to investigate whether Neo-Fisher and Fisher Effects mentioned in the economic literature under current economic developments are valid in the Turkish economy. In the study, inflation and interest rate data for the periods 2011:06-2023:11 in Turkey were used, and while CPI was included in the analysis to represent inflation, 1-month, 3-month, 6-month and 1-year weighted deposit interest rates were other variables used. According to the results of the Toda-Yamamoto test performed to test the causality relationship between the variables in question, a bidirectional relationship was detected between both variables and it was concluded that the Neo-Fisherian effect is valid in the Turkish economy.