The Limited Times

Now you can see non-English news...

Record low! Next lira crisis on the march - Erdogan simply wipes away Turkish worries


The Turkish lira is currently rushing down into a deep valley. President Recep Tayyip Erdogan does not seem to be worried about this development. In contrast to his people.

The Turkish lira is currently rushing down into a deep valley. President Recep Tayyip Erdogan does not seem to be worried about this development. In contrast to his people.

  • Turkey: The Turkish currency lira is at a record low.
  • After all, that pleases the vacationers in the country.
  • The locals take precautions against it - although Recep Tayyip Erdogan remains calm.

Frankfurt / Main - The decline in the Turkish currency continues. After the Turkish lira had already hit lows last week, the exchange rate marked record lows in trading with the US dollar and the euro at the beginning of the week . On the night of Monday, 7,4084 lira were paid for one dollar, more than ever before. Around the same time, a peak value of 8.7217 lira was paid for one euro.

According to Handelsblatt , Recep Tayyip Erdogan was relaxed about the devaluation of the lira over the weekend. "Fluctuations always happen, something like that comes and goes," said the Turkish head of state about the latest developments. The residents of Turkey seem to be more concerned about their savings. According to official information from the Turkish Central Bank, residents have exchanged money worth nine billion US dollars for foreign currency in the past few weeks alone .

Citizens in Turkey have to pay significantly more for imported goods because of the weak currency and can therefore afford less when staying abroad. On the other hand, the development of the lira is advantageous for holidaymakers in Turkey , because more money jumps out when exchanging. In addition to possible corona discounts, this could be a further incentive for a trip to the Bosporus.

Turkey: Lira crisis - weak because of tensions with Greece

Market observers explained the current weakness of the Turkish currency with new tensions between Turkey and Greece in the dispute over natural gas in the eastern Mediterranean. A Turkish research ship is expected to search for natural gas south of the Greek island of Megisti (Kasteloriso) in the coming days.

In response, Athens announced a special session of the Government Council for External Affairs and Defense (KYSEA), chaired by Prime Minister Kyriakos Mitsotakis. Numerous ships of the navy of the two NATO countries are in this region, according to sources of the government in Athens.


Worth less than ever before: the Turkish lira is currently not doing well.

© ADEM ALTAN / afp

Lira crisis in Turkey: Lending to companies is restricted

In response to the recent fall in the lira, Turkey limited its lending to companies on Monday . Foreign exchange experts see little prospect of success in the measures: "No matter which cocktail of banking system cosmetics or partial capital controls is mixed together - it will not be able to reverse the trend of the lira," said analyst Tatha Ghose from Commerzbank. In his opinion, stricter capital controls can at best cause a certain delay.

For some time now, the lira has been suffering from the monetary policy of the Turkish central bank. Despite comparatively high inflation with an annual rate of around 12 percent most recently, the central bank had lowered interest rates several times in order to get the economy going.

Lira crisis in Turkey: conflict in Greece over gas production off the coast of Turkey

The fact that Turkey imports significantly more than it exports is also counterproductive . Which is mainly due to the import of oil or gas . And that's why, according to Handelsblatt, the conflict with Greece should smolder again. According to international law, most of the waters off the Turkish coast are attributed to Greece - according to a corresponding Convention on the Law of the Sea. Erdogan would like to produce the gas in this region himself.

Another problem with the lira: Turkey has been accused from various sides of delivering weapons to Libya and thus further fueling the civil war there. The country makes few friends with this type of export. According to dpa information, Germany, France and Italy are said to have agreed to counter this approach with EU sanctions. There is already a list of companies and people who would provide ships, planes or other logistics for the transport of weapons . Those affected would violate the UN embargo that has existed since 2011. (dpa, mg)

After the easing, more and more people from Russia are also coming to Turkey:

Source: merkur

You may like

Trends 24h

News/Politics 2020-10-27T06:15:03.999Z
News/Politics 2020-10-26T21:56:52.399Z


news 2020/10/27    

© Communities 2019 - Privacy