Three members of the monetary policy committee (MPC) of the central bank fired today, Thursday (14/10) the president of Turkey Recep Tayyip Erdogan and then appointed two new members, according to the Turkish Government Gazette, resulting in the Turkish lira to fall to new record lows.
According to the Government Gazette Turkey, those fired are Deputy Governors Semih Tumen and Ugur Namik Kucuk, as well as another MPC member, Abdullah Yavas. Erdogan has appointed Taha Cakmak as deputy governor of the central bank and Yusuf Tunas as a member of the MPC, the same source added.
According to the APE-MPE, analysts see this move as one new proof of political involvement by Erdogan, who declares himself an enemy of interest rates and often calls for their reduction.
The pound fell to a record low of 9.1900 against the dollar after the announcement, losing 1% during the day. So far this year its exchange rate has decreased by 19%, due to monetary policy concerns. Later it recovered some of the losses of the day and at 08:33 (Greek time) its exchange rate was 9.1325 for one dollar.
The changes to the MPC came after the presidency announced on Wednesday night (13/10) that Erdogan had met with Central Bank Governor Sahak Kavtsioglu, posting a photo of Erdogan with the governor next to him.
A source told Reuters that both Yavas and Kyutsuk had recently opposed some of the decisions taken by the MPC while Kyutsuk had also in recent years opposed the sale of foreign exchange reserves to support the pound.
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