Turkish lira falls to new low and Erdogan defends rate cuts
Due to the Turkish government and President Recep Tayyip Erdogan’s failed attempts to save the lira from successive collapses and improve the economic situation, the Turkish currency is losing its value against the dollar day by day in an alarming way.
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The exchange rate of the Turkish currency fell to its lowest ever level, with the dollar approaching 15 Turkish lira, prompting the Turkish Central Bank to intervene by selling foreign currencies on the market in an attempt to limit the deterioration of the national currency.
This comes amid expectations that the Central Bank of Turkey will once again cut interest rates this week, and despite Erdogan’s insistence on cutting interest rates on the grounds that it is necessary for the country’s economic independence and revival, while the opposition is skeptical about the government’s announced inflation and exchange reserves, amid a state of high prices and popular boiling.
The Turkish lira has lost nearly 7% of its value, to 14.4 against the dollar, dropping to record lows. Financial market experts attributed the fall to ongoing concerns about Erdogan’s new “risk-taking” economic policy and the prospect of cutting interest rates again this week, as the government tries to allay business fears after the currency crash.
With that collapse and the country’s rampant economic crisis, the popularity of Turkish President Recep Tayyip Erdogan, who maintains his economic decisions and monetary policy, has plummeted even in his hometown, the farming town of Rize, where residents are reconsidering the policy of the ruling party.
The local currency has so far lost around 45% of its value, so Turks question the correctness of the presidential decisions, especially as the middle and poor classes have been hit hard by the interest cuts, at Erdogan’s direction.
According to a Bloomberg survey of 19 analysts, the bank is expected to cut its benchmark interest rate by 100 basis points to 14%.
