Turkish lira hits a new low as Erdogan eyes bigger role in monetary policy
Istanbul/Dubai — The Turkish lira and bonds declined to a new record after President Recep Tayyip Erdogan said he plans to take more responsibility for monetary policy if he wins an election in June. That spooked investors, who worry about his dislike of high interest rates. Erdogan’s comments are spoiling bets that a meeting at his palace last week with economic policy makers — including central bank governor Murat Cetinkaya — would open the way for rate increases. Some traders had been positioning for an increase at an unscheduled monetary policy meeting. The lira has weakened by 13% against the dollar this year, extending the biggest depreciation among emerging-market currencies after the Argentinian peso. The yield on 10-year government bonds has surged to a record high. Investors say double-digit inflation and the economy’s growing twin deficits require rates to move higher in order to stabilise the country’s assets against the prospect of higher US borrowing costs. "Investors ...
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