Turkish President Tayyip Erdogan said on Thursday that he has advised the central bank to lower its policy rate at upcoming meetings, a day after saying he expects rates to drop to single digits by the end of the year. year.
Turkey’s central bank has cut its benchmark interest rate by 200 basis points to 12% in the past two months, shocking markets after inflation soared to 80% in August.
The interest rate cuts are part of Erdogan’s unorthodox economic policy of lowering interest rates to contain inflation.
A easing cycle late last year triggered a currency crisis that fueled inflation, now at a 24-year high.
“My biggest battle is with interest rates. My biggest enemy is interest. We lowered the interest rate to 12%. That’s enough? It is not enough. This needs to drop even further,” she said.
On Wednesday, Erdogan said interest rates would fall to single digits by the end of the year, despite a global cycle of monetary tightening, a struggling currency and rising energy prices.
The Turkish lira, which hit a record low of 18.55 against the dollar on Thursday, has fallen about 29% this year, on top of a 44% drop last year on concerns over unorthodox economic policies.
Source: CNN Brasil
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