Ankara-Sana
Today, the Turkish lira recorded a record decline against the dollar, after the Turkish Central Bank announced a cut in the interest rate to 15 percent, confirming its classification as the worst performing currency in emerging markets this year.
Reuters reported that the Financial Policy Committee of the Central Bank of Turkey announced, during its meeting today, to cut the interest rate by about 100 points, bringing the interest rate down from 16 percent to 15 percent, as the dollar came close to breaking the barrier of 11 lira, while the euro rose to 12.3 lira, and the pound sterling recorded 14.6 lira.
The Turkish Central Bank’s tendency to reduce the interest rate, despite the annual inflation rates reaching 19.89 percent during the month of October, sparked criticism about ignoring the high inflation rates and the Turkish Central Bank’s acquiescence to the continuous pressure exerted by the Turkish regime President Recep Tayyip Erdogan to reduce business costs in order to stimulate growth Erdogan's policies have raised the annual inflation rate to about 20 percent, while the lira has lost more than a quarter of its value against the dollar this year.
In turn, Jason Tavi, an analyst at the Capital Economics Center for economic research, considered that there are increasing risks that the central bank's continued acquiescence to Erdogan's pressure in terms of reducing interest rates will lead to a significant and uncontrolled deterioration of the Turkish currency in the coming days and weeks.