Toward Sustainable Input Pricing in Agriculture: The Sectoral Impact of Asymmetric Monetary Policy in Türkiye

ABSTRACT This study investigates the asymmetric effects of monetary policy instruments on agricultural input prices in Türkiye, a developing economy. Using monthly data from 2015 to 2024, the analysis focuses on key variables including the exchange rate, consumer price index (CPI), policy rate, reserve requirement ratio, and rediscount rate. Asymmetric fully modified ordinary least squares (FMOLS) and impulse‐response analyses reveal that positive exchange rate shocks significantly and persistently increase input costs, highlighting the sector's import dependence and vulnerability. Inflation and policy rate hikes also raise costs, but declines in these variables do not produce equally strong reductions—indicating asymmetric effects. Similar patterns are observed for other monetary tools. The findings emphasize that both the direction and magnitude of macroeconomic shocks matter for agricultural input pricing. Therefore, monetary policy must account for sector‐specific sensitivities and transmission mechanisms. In critical sectors like agriculture, tailored policy designs are essential for stabilizing costs, supporting food security, and enhancing rural economic resilience.