May 11 2019

Turkish central bank to defend lira with determination – Erdoğan ally

Turkey’s central bank will act decisively to bolster the lira, which has been manipulated by market speculators to force the government into a corner, said Kerem Alkin, head of a major export association and a political ally of President Recep Tayyip Erdoğan.

The government ‘”is facing an extremely manipulative attack on the exchange rates” allegedly based on central bank policy, Turkey’s economic policy and political tensions with the United States, Alkin, who is an economics professor and General Secretary of the Turkish Exporters’ Assembly (TIM), said in a column for the Daily Sabah newspaper late on Friday.

“This leads to the following results: steps that will be taken with determination by the CBRT to protect the value of the Turkish lira; the acceleration of normalization in inflation and re-balancing in growth; sensible steps and solutions, which look out for Turkey's interests and will decrease the tension on issues in U.S. relations such as the S-400s, Syria and the Eastern Mediterranean,” he said.

Turkey’s lira slumped to a seven-month low this week, prompting the central bank to stop lending at its benchmark rate of 24 percent, forcing banks to borrow at higher rates of interest. Turkey suffered a currency crisis last year and some economists have warned that the turmoil, which pushed the economy into recession and sent inflation soaring, threatens a revival.

Turkey will also launch “counterattacks that will eliminate or neutralise the vicious operations on the global image of Turkey, and projects and strategies that will strengthen Turkey’s global image,” Alkin said.