Nov 21 2017

Turkish central bank cannot raise interest rates - adviser

Turkey's central bank cannot increase interest rates as a means to  tackle inflation and ensure financial stability, Cemil Ertem, an adviser to President Recep Tayyip Erdoğan, said on Tuesday.

The bank will only "pour fire" on the situation, strangling production in the medium term, Ertem said in a column in the Milliyet newspaper.

In the article, Ertem, an academician, gave a history lesson in economics, spanning the post-World War Two period, touching on the economic policies of ex-Federal Reserve Chairman Paul Volcker, Thatcherism and the Reagan era to show how interest rates were used to stifle production, increase the monopoly of conglomerates and to reduce their tax burden.