Monetary tightening will hit domestic demand, Turkey's finance minister told CNBC on Wednesday, after the country's central bank hiked interest rates to 12 percent.
(Read more: Turkey in massive interest rate hike to defend lira)
"There is monetary tightening — that is the increase in interest rates. In this regard, risks related to growth associated with domestic demand increased. In other words, to be frank, domestic demand will weaken," said Mehmet Şimşek, the Turkish minister finance since May 2009.
