Turkish finance minister urges fight against inflation

ISTANBUL

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Turkey needs to maintain its fight against inflation until it falls below an annual rate of 5 percent for good, Finance Minister Mehmet Şimşek said Feb. 18 in an interview on Turkish news channel CNN Türk.

He added too much talk over the Central Bank’s monetary policy may cause concerns among investors.

It is the Central Bank’s main duty to maintain price stability, so it must make decisions on a rational basis, he said.

Making currency rate policies become a point of daily political polemics in a country has many negative effects, pushing the country’s risk premiums and rates up and making it less predictable, Deputy Prime Minister Ali Babacan also said on Feb. 12, in a TV interview broadcast on state-run TRT.

The Central Bank scrapped the idea of holding an emergency rate meeting earlier this month amid rising pressure from political circles to cut rates.

Şimşek also said the fall of the Turkish Lira against the U.S. dollar was due to the strength of the U.S. currency globally. He added that the lira’s weakness was a risk for inflation.