The Turkish lira fell to a new record low against the dollar as the president Recep Tayyip Erdogan getting ready to decide the composition of the new cabinet and the direction of economic policy following his electoral triumph.
For a third day of losses in a row, the pound fell almost 1.5% to a record low of 20.75 against the US dollar, taking its losses this year to almost 10%.
Investors are worried about the sustainability of Turkey’s unorthodox economic policies as they watch a low interest rate program championed by Erdogan.
Erdogan’s meeting earlier this week with Mehmet Simsek, a former economic “tsar” who is respected by investors because he supports an orthodox economic policy, they have sparked speculation of a possible shift towards more conventional policies.
“I don’t know if he will be the new finance minister or not, but any credible name is important to give a signal to the market that there is going to be a change. Actions speak louder than intentions,” said Chagri Kutman of KNG Securities.
“If it’s Mehmet Cisek or someone else with similar views, it will be a big move. But then the market will be curious to see the first move of the economic team – will there be more orthodox policies, will they do something worse or will they do something to buy time and see how it goes?”
Economic growth in the first quarter remained strong despite the impact of the earthquake in southern Turkey, high inflation and rising living costs, Reuters reports and the Athens News Agency reports.
Its economy Turkey grew 4.0% in the first quarter of the year, slightly more than expected, according to official data released today, despite the impact of February’s earthquakes that killed more than 50,000 people and left millions more homeless .
First-quarter GDP rose 0.3 percent from the previous quarter on a seasonally adjusted basis, according to Turkish Statistics Institute data.
Source: News Beast
With 6 years of experience, I bring to the table captivating and informative writing in the world news category. My expertise covers a range of industries, including tourism, technology, forex and stocks. From brief social media posts to in-depth articles, I am dedicated to creating compelling content for various platforms.