Erdogan hopes policy rate will come down to single digits by year-end
Turkish President Recep Tayyip Erdoğan on Wednesday said he hopes the central bank’s monetary policy committee will deliver another cut to its policy rate next month and bring it down to single digits by year-end, Reuters reported.
Erdoğan, speaking in a televised interview with broadcaster CNN Türk, said Turkey aims to strengthen the lira by reducing interest rates.
Turkey’s central bank unexpectedly cut its policy rate by 100 basis points twice in the past two months, lowering it to 12 percent despite inflation at more than 80 percent in August. An easing cycle at the end of last year, long sought by Erdoğan, sparked a currency crisis.
Erdoğan has openly championed economic growth at all cost.
He also rejects conventional economics and believes that inflation can be brought under control by cutting interest rates.
“I am an economist. Inflation is not an economic danger that cannot be overcome,” Erdoğan told US television last week.
“Currently, there are countries which feel threatened by inflation of even eight or nine percent. We have 80 percent,” he said.
“And in my country, the shelves are not empty in the markets.”
Source: Turkish Minute