Turkish economy minister supports Erdoğan’s call for rate cuts

VIENNA - Anadolu Agency

Minister Zeybekci says all of Turkey’s economic expectations for 2015 are very positive in a meeting in Vienna. AA photo

Turkish Economy Minister Nihat Zeybekci has backed President Recep Tayyip Erdoğan’s recent call for a cut in interest rates, saying the current rates imposed by the Central Bank are unreasonable while speaking at a press conference late Jan. 16.

 “All of Turkey’s economic expectations for 2015 are quite positive,” Zeybekci said. “Suffering from high interest rates while being one of the advanced economies is unacceptable.”

 Turkey’s monthly inflation rate in December was down for the first time in 2014, hitting a 10-month low of 8.17 percent, calculated as a moving average of the past 12 months, the Turkish Statistical Institute (TÜİK) recently announced.

The current account deficit in the January to November 2014 period narrowed to $38.7 billion, a decrease of $18 billion, compared to the same period a year earlier.

A slump in oil prices from $110 to $50 per barrel is expected to halve Turkey’s oil imports and further reduce the current account deficit and inflation in 2015.

 “I think that keeping silent about this [high interest rates] is wrong,” Zeybekci said. “I believe Turkey should get past this period of high rates as soon as possible.”

Erdoğan has recently reiterated his long-established criticism on the country’s Central Bank for not reducing interest rates despite a sharp decrease in oil prices, vowing to question the bank governor over its rate policies in person.

“We have no problems with oil [prices]; on the contrary we are at a very good point. Therefore, we should find ways to let our people and our investors take advantage of it. What is the Central Bank waiting for? Now they can say the bank is independent. I am independent, too,” Erdoğan said at a meeting with young businesspeople in Ankara on Jan. 16. 

“As the voice of the people, I should speak about it. And if necessary, I will call them and we will talk about it. This cannot continue this way,” he said.