Modeling of the Relationship Between BIST100 Index and Central Bank Interest Decisions by the Quantitative Decision Method

Central banks, which are among the most important institutions that shape the world financial history, monitor the financial markets, manage the volume of the national currency and monetary policies.Central banks use monetary policy decisions and monetary transmission mechanisms.Central banks, which have the power to manage and shape the markets, use this power; they use it to protect the value of the country's currency and to ensure price stability.The Monetary Policy Committee (MPC), which is within the institutional structure of the CBRT, regulates interest rates with the monetary policies it implements and thus directly affects the financial markets.These policy decisions of the MPC may affect not only the Turkish financial system, but also other markets to which it is connected.The factor that creates this effect is realized through the money transfer mechanisms created by the MPC's interest and similar decisions.money transfer; It is the process that determines the demand of monetary changes and the direction of the products being affected (Alkan, 2016: 153).As a natural consequence of this process, investment decisions are also affected.Interest rates are determinant on investments and consumption expenditures.Stock exchanges are important institutions that mediate the evaluation of investments in capital markets.Stocks are one of the main investment instruments in financial markets.BIST is an international platform for investors who buy and sell stocks in Turkey.Operating in the markets under the name of Istanbul Stock Exchange (IMKB) between 1985 and 2012, BIST provides liquidity and resources to the market and also fulfills an important financial function that allows the ownership to be spread to the public.Determining the most appropriate interest rates simultaneously with market conditions is one of the most important monetary policies.In this study, the effect of the maximum interest rate decisions on deposits taken by the TCMB between January 2010 and February 2022 on the BIST 100 index was examined.. LITERATURE SURVEYWhen the studies on stock exchange interactions are examined in the literature, the relations between exchange rates and stocks are frequently encountered.The findings of these studies can be evaluated in three groups.First, the relationship between the two variables, regardless of whether it is short or long term, has been determined.Among these studies;