Turkish bank should resist rate hike: wealth fund manager

Turkey’s central bank should not raise interest rates as it will spur cost-price inflation, said Kerem Alkin, a director of Turkey’s sovereign wealth fund.

A rate hike will also prompt Turkey’s enemies to portray the country as an unsafe place to invest, Alkin wrote in a column for the Daily Sabah newspaper.

The increase in interest rates will increase cost inflation, as it will increase resource costs in the economy and credit costs in the real sector. Second, the interest rate gap between Turkey and the G20 countries will grow. The same global circles will try to use the latter against Turkey, claiming that Turkey's global perception is deteriorating.

The government should implement a “counter-perception study” highlighting the strengths of the nation’s economy and render the pace of industrial production permanent to help achieve growth and employment targets for 2018, Alkin said.

That will help economically defeat the same powers that Turkey defeated in a corruption probe in 2013 and in the July 15 coup attempt, he said.

Global powers have mounted an attack against us through credit-ocracy by using all global market and media instruments to prevent us from focusing on the reform process, which will accelerate our switch to a more strengthened democracy.