The value of the lira has halved in a year.
Turkey the central bank had to intervene in the market on Monday when the value of the Turkish lira fell seven percent, according to Reuters. At its worst, one US dollar (about 0.9 euros) corresponded to nearly 15 lire on Monday.
For the fourth time in two weeks, the central bank had to sell dollars to make the lira exchange rate pop up.
According to banking analysts, the central bank sold as much as $ 1.5 billion to $ 2 billion on Monday, up from $ 2.5 billion in previous weeks.
International major currency strategy by Brown Brothers Harriman, a U.S. investment bank Win Thin called on Reuters to take central bank action to “glue the patch over the open wound”.
Per year the value of the lira has halved. The Turkish economy relies heavily on imports and the depreciation of its currency has exacerbated the country’s inflation. According to the BBC, inflation was in November 21.7 percent.
The minimum wage of about ITL 2,826, which was raised by more than 20% at the beginning of the year, corresponded to EUR 337 at the beginning of the year. Now it would only correspond to 181 euros. Turks interviewed by HS according to the currency crisis affects everyday life in Turkey.
Read more: Turkish currency’s downward spiral and inflation are widely felt in the daily lives of residents – Kurimus could be a political turning point for President Erdoğan
On Friday, the credit rating agency S&P reaffirmed Turkey’s long-term currency rating at B + and turned the outlook to negative due to uncertain policies and growing external risks.
Currency crisis has also shaken confidence in the president Recep Tayyip Erdoğanin administration.
Erdoğan is heavily involved in central bank operations. He has called his economic policy an “economic struggle for independence” and does not allow interest rates to rise in the country. According to Erdoğan, the fall in interest rates is part of his plan for economic growth, which has been harshly criticized by opposition politicians and economists.
Vice President of International Development for the Middle East and Turkey at the United States Chamber of Commerce Khush Choksy said Erdoğan said economic policy was unclear, as was the connection between the economic plan and the private sector.
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source https://pledgetimes.com/currencies-the-turkish-lira-sank-to-a-record-low-with-the-central-bank-once-again-forced-to-intervene-in-the-market/
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