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Turkey's central bank on Thursday cut its benchmark interest rates by 25 basis points in a fresh bid to prop up the recession-hit economy.
The bank's monetary policy committee said in a statement it had decided to cut the borrowing rate from 6.75 percent to 6.50 percent and the lending rate from 9.25 percent to 9.00 percent.
"Recent data releases indicate that... the ongoing recovery in economic activity will be gradual and protracted," the committee said in a statement.
"External demand and domestic investment demand remain weak," it added.
The move comes after new data showed the Turkish economy shrank by 7.0 percent in the second quarter following a record fall of 13.8 percent in the first quarter.
The government is forecasting a contraction of up to 6.0 percent for 2009.
The unemployment rate also reached 12.8 percent in the second quarter -- 2.9 percent higher than in the same period last year.
