The Central Bank of the Republic of Turkey on Thursday announced that it would hold key interest rates at current levels except marginal funding rate, the bank said in a statement on its website.

The one-week repo rate will be kept at 7.50 percent, 7.25 percent for the borrowing rate, but the overnight lending rate will be cut from 10.75 to 10.50 percent, the statement by the Monetary Policy Committee said.

"Recently, global volatility has eased to some extent. Moreover, with the use of the policy instruments laid out in the road map published in August 2015 effectively, the need for a wide interest rate corridor has been reduced," the bank's statement said. "In this respect, the Committee decided to take a measured step towards simplification. However, improvement in the underlying core inflation trend remains limited, necessitating the maintenance of a tight liquidity stance."

The bank added that economic growth, maintained by exports supported by rising demand from the EU countries, was favorable.

The move was expected by economists a majority of whom had forecast a hold in rates and a simplification of the monetary policy structure as promised by the central bank in August.

"The Central bank needs to take care of core inflation trend, there is still an upward pressure there," said ALB Securities analyst Enver Erkan. "There is still a need of large interest rate corridor, so that the basic aim of monetary policy should continue, in order to make domestic markets less fragile to foreign shocks."

"If global economies' negative trend continues until the end of the year, these kinds of steps could not be sustainable. We expect no market volatility, but the Turkish lira would be weaker against the dollar in the middle and long term," he added.