Turkish lira crashes to record low on Erdogan’s call for rate cut

His frequent calls for rate cuts & removal of three central bank chiefs have exposed Turkey to more financial stress.

President Recep Tayyip Erdogan has sent Turkey’s lira currency to new all-time lows after he called for interest rate cuts in the next two months and said he spoke to the central bank’s new governor about it. “I am behind the same claim on this issue – I even spoke to the central bank governor today – we certainly need to lower interest rates,” Erdogan told a televised interview with state broadcaster TRT Haber late on Tuesday. “For that, we need to see July, August for interest rates to start coming down,” he said, adding that lowering interest rates would lift the burden on investments. The Turkish leader’s remarks were part of a longer explanation of his unorthodox belief that lower borrowing costs will help slow inflation, unlike what most central bankers around the world believe. Cutting interest rates will lower producers’ costs and eventually result in slower increases in consumer prices, Erdogan said.