Eyes on Central Bank meeting as Turkish Lira weakens
ANKARA
All eyes will be on Turkey’s Central Bank on Nov. 24 when it convenes for a rate policy meeting amid a continued slide for the Turkish Lira.The lira’s value regressed to 3.41 to the U.S. dollar on Nov. 23, hitting a new record low level, as both domestic and global developments have been exerting pressure on the currency for a while.
Economists are divided over the possibility of a lira-supportive rate rise at the Central Bank’s meeting, with almost half of those surveyed by Reuters predicting a 25 basis point rise in one-week repo rates to 7.75 percent.
The currency has fallen 14 percent against the dollar, with around half of those losses coming this month.
Therefore, emerging European markets are focusing on Turkey to see if top officials will soften their stance on raising interest rates, given the lira’s 8 percent decline since the U.S. election alone.
The Central Bank kept rates on hold last month, citing the weaker exchange rate’s possible side effects for inflation.
Another key meeting was also scheduled to be made late on Nov. 23. President Recep Tayyip Erdoğan was expected to chair an economic coordination committee on the eve of the Central Bank meeting that may event deliver the first rate rise in almost three years.
The meeting was scheduled to be held in Erdoğan’s presidential office in Beştepe in Ankara, television media reported.
The government canceled an economy board meeting (EKK) with top economy officials that was to be headed by Prime Minister Binali Yıldırım on Nov. 22, citing a change in his program.
The canceled meeting would have been the second such gathering under the leadership of Yıldırım in less than week to discuss the recent precipitous fall in the value of the lira, which has hit a series of record lows against the dollar.
The EKK convened last week after the lira’s latest sell-off.
The canceled meeting would have been the second such gathering in less than week to discuss the recent precipitous fall in the value of the lira, which has hit a series of record lows against the dollar.
After the meeting on Nov. 18, sources in Yıldırım’s office said the Central Bank had agreed it would “take the necessary steps” to ensure price stability.
Speaking to reporters on Nov. 22 at Istanbul’s Atatürk Airport, Yıldırım said “there is nothing to worry about in the economy,” despite recent turbulence.
“After [Donald] Trump won the U.S. presidential election, global markets have seen heavy fluctuations, pushing up the dollar’s value against many currencies. This trend will likely continue for a while,” he said, adding that Turkey would be taking “a number of measures.”
“These measures can be outlined under two headings: Measures taken by the Central Bank and others taken by the government,” Yıldırım noted.
Economists are divided over the possibility of a lira-supportive rate rise at the Central Bank’s meeting, with almost half of those surveyed by Reuters predicting a 25 basis point rise in one-week repo rates to 7.75 percent.
The currency has fallen 14 percent against the dollar, with around half of those losses coming this month.
Therefore, emerging European markets are focusing on Turkey to see if top officials will soften their stance on raising interest rates, given the lira’s 8 percent decline since the U.S. election alone.
The Central Bank kept rates on hold last month, citing the weaker exchange rate’s possible side effects for inflation.
Another key meeting was also scheduled to be made late on Nov. 23. President Recep Tayyip Erdoğan was expected to chair an economic coordination committee on the eve of the Central Bank meeting that may event deliver the first rate rise in almost three years.
The meeting was scheduled to be held in Erdoğan’s presidential office in Beştepe in Ankara, television media reported.
The government canceled an economy board meeting (EKK) with top economy officials that was to be headed by Prime Minister Binali Yıldırım on Nov. 22, citing a change in his program.
The canceled meeting would have been the second such gathering under the leadership of Yıldırım in less than week to discuss the recent precipitous fall in the value of the lira, which has hit a series of record lows against the dollar.
The EKK convened last week after the lira’s latest sell-off.
The canceled meeting would have been the second such gathering in less than week to discuss the recent precipitous fall in the value of the lira, which has hit a series of record lows against the dollar.
After the meeting on Nov. 18, sources in Yıldırım’s office said the Central Bank had agreed it would “take the necessary steps” to ensure price stability.
Speaking to reporters on Nov. 22 at Istanbul’s Atatürk Airport, Yıldırım said “there is nothing to worry about in the economy,” despite recent turbulence.
“After [Donald] Trump won the U.S. presidential election, global markets have seen heavy fluctuations, pushing up the dollar’s value against many currencies. This trend will likely continue for a while,” he said, adding that Turkey would be taking “a number of measures.”
“These measures can be outlined under two headings: Measures taken by the Central Bank and others taken by the government,” Yıldırım noted.
