As long as Turkish President Tayyip Erdogan insists that he will continue the economic policy chosen by the pound, he continues to receive new blows every day.
The exchange rate of the Turkish lira-dollar is now at 1:13, with the Turkish national currency having today lost 2.7% of its value against the US reference currency. At the same time, the pound continues to fall against the euro with 3.55% and a ratio of almost 1:15. In fact, for the past two months, almost every day, the Turkish pound has been setting a new negative record, destroying the income of the average Turkish citizen.
From the discussion of the country’s exports in 2008 protesting that the then hard pound was approaching the ratio 1: 1 to the dollar, within 13 years things came to the opposite with the pound falling uncontrollably.
152% devaluation in three years
It should be noted, however, that the pound we are talking about today had another 6 zeros deleted. On February 21, 2001, one dollar was equivalent to 1,200,000 Turkish pounds.
With the political developments and the negative current account balance, the Turkish currency started to decline in 2013. In the last 3 years it has decreased by 152%. President Erdogan’s insistence on an aggressive cut in interest rates shows that pressure on the pound will continue and it is by no means certain that even a satisfactory increase in the base wage, which has lost its purchasing power, will guarantee Erdogan victory in the 2023 elections.
Andreas Robopoulos, Istanbul
Source: Deutsche Welle
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Source From: Capital
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