Lira on four-day skid as Ankara struggles to hold confidence

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ISTANBUL – The Turkish lira dropped to 6% on Thursday, boosting its four-day slide and eating of last week’s high yields, as the government urged rescuers and depositors to ignore instability and concerns over rising prices and unpredictable declines.

The fund has lost about 20% in four trading zones, reviving more than 50% of the meeting in the past five days initiated by the government’s new lira deposit protection system due to lower inflation.

The lira weakened to 13.4 per dollar before returning to 13.05 and 0909 GMT, still below 3% on the day. It has changed from 18.4 to 10.25 in the last two weeks, a shocking turn of events for the Turkish people who have seen their money run out and household incomes raised.


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The fast-moving financial crisis was sparked by a sharp reduction in interest rates since September when President Tayyip Erdogan was asked under the “new fiscal policy” that focused on export and debt.

Economists and opposition lawmakers said the plan was slowing down despite rising prices by more than 21%, and is expected to rise by more than 30% this month and in the coming months, mainly due to lower lira prices.

Finance Minister Nureddin Nebati – who was elected by Erdogan earlier this month – has given a series of interviews on television and said late Wednesday the instability is not a concern.

He predicted a single price hike by 2023, which is more hopeful than experts ’speculation.


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Nebati also said that there was no way the government was going to sell the dollar and strengthen the lira last week – although data shows that the central bank’s foreign exchange rate had declined from what banks said was showing support for the government-backed market.


According to bank accounts from preliminary data, central bank reserves fell by $ 2.5 billion last week while total reserves went down to $ 5 billion even though nothing was announced.

This indicates that his foreign exchange rate declined until May. Approval information is due at 1130 GMT.

Under Erdogan’s conspiracy, the Treasury or central bank will hide the difference between deposit and foreign exchange rates and the lira gold converted into a new instrument, which means turning the waves of dollarization.


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Many economists have warned that if the currency continues to fall in price, the system could exacerbate inflation and exacerbate economic woes.

Nebati told CNN Turk radio that $ 59.8 billion ($ 4.60 billion) had been in protected areas since Wednesday. Subsidized foreign exchange deposits have dropped by $ 7 billion to $ 162 billion since the plan was announced on December 20, he added.

Some analysts have told Reuters that a savings plan, as well as a 50% pay rise, could pave the way for Erdogan to make short-term decisions before the 2023 reform process.

“Emergency emergency measures provide only temporary relief; in the long run, they seem to be able to exacerbate the problem,” said Howard Eissenstat, an assistant professor of Middle East history at St. Lawrence University in New York State.

($ 1 = 12,9914 rs)

(Reports by Ezgi Erkoyun and Nevzat Devranoglu; Edited by Sam Holmes, Jonathan Spicer and Emelia Sithole-Matarise)



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