People shop at a local market in Istanbul, Turkey on December 5, 2021. The falling Turkish lira has weakened people’s purchasing power.
Erhan Demirtas | NurPhoto via Getty Images
Turkey’s battered currency fell to new lows on Monday 14 to dollar, ahead of what investors expected was a rate cut from the central bank despite soaring inflation.
The lira was trading at 14.33 to the dollar at 1:25 pm in Istanbul, according to Reuters data, a slight bounce from a record low of 14.99 earlier in the day. This is the first time this coin has surpassed 14 to the greenback.
Turkey’s central bank then announced it would intervene directly in the foreign exchange market on Monday, selling dollars to prop up the lira.
Turkish Finance Minister Nureddin Nebati on Monday said the country is determined not to raise interest rates – echoing President Recep Tayyip Erdogan’s hardline stance against rate hikes – which economists say agreed to actually support the currency and curb inflation, currently near 20%. domestic 84 million.
“We’re not going to raise rates; you’ll see that we can do this without raising rates,” Nebati said, adding that he doesn’t know if central bank monetary easing will stop. again or not.
