Turkish central bank hikes interest rates to 24%

16 September, 2018, 00:37 | Author: Brooke Harris
  • The president will oversee financing for large state development projects

The decision came after Turkey's central bank increased interest rates in efforts to stop the declining value of the lira.

All 11 economists in a Reuters poll had forecast the bank would tighten, with the predictions ranging between 225-725 basis points as it balances concerns over the lira's weakness with worries about a sharp economic slowdown.

The leader placed his son-in-law as head of the finance ministry and in a separate move has attempted to take control of the country's sovereign wealth fund.

"Hiking today does get Turkey on the slow road to recovering some monetary policy credibility, and that is critical".

Late on Thursday, Finance Minister Berat Albayrak told pro-government newspaper Sabah that the central bank's move had put an end to any discussions about the bank's independence, and said Turkey would unveil its medium-term economic program on September 20.

The bank said on Thursday that inflation developments pointed "to significant risks to price stability" due to the recent fall in the value of the lira.

Erdogan also used his speech to attack the central bank for consistently missing its inflation targets, and faulted policy makers for failing to see what he considers to be the true relationship between the cost of credit and consumer prices.

The lira's gains is also proving to be a positive across emerging markets as well with the rand and rouble also gaining on the day, both currencies up by more than 1% against the dollar.

North Carolina TV station evacuates because of rising water
And Florence remained capable of unleashing rain-fueled catastrophic flooding of rivers and low-lying areas across a wide region. Utility officials have warned that widespread power outages are likely and that it could take weeks to restore electricity .

The Turkish currency lost almost a quarter in value against the dollar in August.

Europe followed, with 0.2-0.6 per cent rises for German, French, Italian and Spanish shares offsetting a FTSE in London, which was being held back by weak oil and tobacco stocks. Dollar-denominated bonds issued by the Turkish government rose across the curve.

A policy meeting by the Turkish central bank is expected to raise its interest rates sharply to shore up its battered lira.

Erdogan a year ago said the fund needed a "reorganisation" after the first chairman Mehmet Bostan was removed from his post in September 2017.

"Great decision - made all the more hard by the huge pressure on the central bank from Erdogan", said Bluebay Asset Management LLC strategist Tim Ash. You see that in mid-year, it revises the inflation rates.

Thursday's surprise move buoyed markets that had been mired in a slump for months, triggered by a diplomatic row with the USA and then amplified by central bank inaction.

But the day's big move was Turkey's lira which swung nearly 6 per cent in a wild few hours.

Purchase, sales and rental contracts of moveable and immovable properties and vehicle leasing made in foreign currencies will be converted into Turkish lira within 30 days, according to the decree. This article is strictly for informational purposes only.

Recommended:

  • Win A Brand New iPhone XS Max!

    Win A Brand New iPhone XS Max!

    If there was any takeaway in Apple's big iPhone unveiling on Wednesday, it's that buying an Apple handset is really expensive. The 7nm Apple A12 chipset is present under the hood of the newly unveiled iPhone Xs, iPhone Xs Max and iPhone Xr smartphones.
    New Super Mario Bros. U Deluxe announced for Switch

    New Super Mario Bros. U Deluxe announced for Switch

    Another annoyance will likely come from the fact that Nintendo won't hold onto your cloud saves if your subscription isn't active. The new version adds gyro controls, HD rumble and single Joy-Con controls for multiplayer battles.
    Cayman urged to watch Tropical Storm Isaac as path waivers

    Cayman urged to watch Tropical Storm Isaac as path waivers

    The National Weather Service says Hurricane Florence "will likely be the storm of a lifetime for portions of the Carolina coast". Florence, however, continues to threaten the east coast as a fierce storm that could trigger flooding as far south as Georgia.
  • Paul Manafort reportedly close to Mueller plea deal to avoid second trial

    Paul Manafort reportedly close to Mueller plea deal to avoid second trial

    Then the judge overseeing his case, Amy Berman Jackson, delayed a major court hearing set for this about his upcoming trial twice. Trump discussed a possible pardon for Manafort with his lawyers earlier this summer, attorney Rudy Giuliani has told NPR .
    David Luiz: 'I believe in Maurizio Sarri philosophy'

    David Luiz: 'I believe in Maurizio Sarri philosophy'

    I need to be ready for that but I haven't got a target. He added: "Then I'd like to start again". Terry spent last season at Aston Villa .
    First deaths reported from Hurricane Florence after Wilmington home collapses

    First deaths reported from Hurricane Florence after Wilmington home collapses

    When all is said and done, Florence could dump 18 trillion gallons along its path, according to meteorologist Ryan Maue. More than 722,000 homes and businesses were without power in North and SC early on Friday, utility officials said.
  • Florence punishes Carolinas with torrential rain, flooding; six dead

    Florence punishes Carolinas with torrential rain, flooding; six dead

    In New Bern, the unsafe conditions prompted officials in the coastal city to place the city under 24-hour curfew at 7 a.m. The strongest wind gusts were recorded at 61 miles per hour at the Myrtle Beach International Airport.
    Dolphins swimming in flood water caused by Hurricane Florence

    Dolphins swimming in flood water caused by Hurricane Florence

    It is not know if the dolphins came into shore to find shelter from the storm or if they were dragged in the the high winds. In New Bern, the unsafe conditions prompted officials in the coastal city to place the city under 24-hour curfew at 7 a.m.
    Pope Summons Bishops For Sexual Abuse Summit

    Pope Summons Bishops For Sexual Abuse Summit

    A church report there found more than 1,600 priests and clerics had abused more than 3,600 minors in a almost 70-year period. A USA bishop accused of molesting adults resigned on Thursday, in the latest sex abuse scandal to rock the Catholic Church .
  • Turkey arms rebels as Idlib prepares for Syrian onslaught

    Turkey arms rebels as Idlib prepares for Syrian onslaught

    Turkey has also gathered forces on its own borders to deter Syrian civilians fleeing the fighting. Turkey, already hosting 3.5 million Syrians, says it can not take in another wave of refugees.
    Golovkin jabs at 'clown' Canelo at weigh

    Golovkin jabs at 'clown' Canelo at weigh

    The panel of ringside judges scored the fight a draw, even though "GGG" looked the more active of the two fighters by a long yard. A relaxed-looking Golovkin later took a verbal jab at his Mexican rival after the face-off.
    Britain to publish more 'no deal' Brexit advice papers

    Britain to publish more 'no deal' Brexit advice papers

    Dr Adam Marshall, director general of the British Chambers of Commerce, added that key questions remained unanswered. Raab told BBC radio he did not believe May's government would lose a vote in parliament on the deal.


Popular

Isaac winds slow to 45 miles per hour , heavy rain, high surf expected
In addition to wind impacts, there's going to be a risky storm surge ("wall of water" that arrives) and then persistent rainfall. More than 60 people had to be rescued in another town as a cinderblock motel collapsed at the height of the storm's fury.

Apple halts the production of iPhone X, iPhone 6s and iPhone SE
Besides from Apple , you can pre-order the iPhone Xs , iPhone Xs Max , and iPhone Xr from your favorite carrier. Apple has just revealed a trio of new iPhones, including its most expensive ever - the £1099 iPhone XS Max .

Maurizio Sarri told how to transform Chelsea into a 'sensational' team
Derby County and Spartak Moscow have both reportedly dropped out of the race for Aston Villa target John Terry. Maurizio Sarri will make a late decision on the fitness of players who returned from global duty.

NASA releases footage showing massive Hurricane Florence from space
Governors of those states have already declared states of emergency, as have the governors of Virginia and Maryland. Emergency workers monitor hurricane progress at the Emergency operations centre in Wilmington, North Carolina.

IPhone XR: Everything you need to know!
The new Apple Watch 4 will come in 40mm and 44mm screen sizes and will be offered in a choice of three aluminium finishes. There's still a notch on top but with a bigger screen, you at least have some more area to left and right of the notch.

NASA video shows Hurricane Florence from space as it makes landfall
Cline said July was the wettest ever in that part of North Carolina, and the water table rose 21 inches higher than normal. North Carolina emergency management officials said more than 600,000 customers in North Carolina were without power.

Jurgen Klopp laughs off Gary Neville’s comments about Liverpool
Adam Lallana (groin) won't feature for Liverpool but Simon Mignolet is fit after a hand injury. We get so much information, we can see how the players react in different situations.

Watch Hurricane Florence Make Landfall in This Incredible Space Station Video
More than 80,000 people were already without power as the storm began buffeting the coast, and more than 12,000 were in shelters. Forecasters say the center of the eye of Hurricane Florence is about to make landfall near Wrightsville, North Carolina.

US fighter jets intercept two Russian bombers near Alaska
A previous interception of bombers occurring on September 1 involved bombers without any Russian fighter jet escorts, CNN noted . A group of Russian nuclear-capable aircraft ventured near Alaska on september 11 before being intercepted by U.S.

Paul Manafort cooperating with investigators in Mueller probe
He was convicted last month of eight financial crimes in a separate trial in Virginia . In court on Friday, Manafort blew a kiss to his wife, Kathleen, before the hearing.