Turkish lira in freefall as Erdogan vows victory in ‘economic war’

The Turkish lira has been the worst day since the financial crisis three years ago.

The currency, which has dropped by 40 percent against the dollar this year, dropped to 9 percent – the biggest drop since August 2018 – and crossed the 12-dollar symbolic limit after Erdogan used the opposite word to explain its meaning. the vision of the world economy.

“It’s like a horror movie,” said Enver Erkan, a Terra Investment expert from Istanbul, adding that it was difficult to predict how much the price would drop as policymakers seemed to be willing to fall.

“This is the inevitable consequence of Erdogan’s war on prices,” said Uday Patnaik, head of market debt arising from Legal & General Investment Management. “The only thing that can prevent a free collapse is the sign of a major independent bank in Turkey. But there is not much hope for that. Erdogan is a kind of double-minded man.”

Erdogan, an anti-interest activist, announced Monday night that he was “delighted” with the central bank. cutting down trees for the third consecutive month last week, despite being warned by economists that this could increase inflation which is already moving by 20 percent a year and further undermining inflation.

Drawing a picture of a global black conspiracy aimed at overthrowing Turkey, Erdogan said the country could not defeat economists, “opportunists” and “global economists” who demanded higher interest rates.

The government is prioritizing economic growth, he said, in order to boost spending, manufacturing, exports and employment. “That is why we do not pay attention to the noise of slanderers,” he said.

He likened the struggle to the struggle of a foreign nation after the first world war, which culminated in the founding of the modern-day republic of Turkey in 1923. “With God’s help and the support of our people we will come out. winners of this war on economic independence, ”he said.

Turkey’s largest bank, which has been hit by a major overhaul of the President, last month he wanted to argue that lower prices could help stabilize inflation and inflation by eliminating the country’s declining accounts.

Economists warn that such assumptions are wrong, and they say allowing the lira to be at risk of inflation in a country that relies heavily on imports and imports.

The downturn is another threat to the quality of life at a time when Erdogan is already facing public outrage over rising inflation.

A Turkish bank clerk described the lira as a “horrible thing” that the government had decided. “The choice is obvious,” he said. “They are just using their method now. This is a new approach. ”

Semih Tumen, deputy governor of the central bank who last month was among several senior officials dismissal by the president, he spoke publicly for the first time since his assassination when the money went down and called on the government to “stop this irrational experiment where there is no chance of success”.

He wrote on Twitter: “We must immediately return to the higher standards which will protect the value of the lira and the well-being of the Turkish people.”

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