The Turkish lira came under strong pressure during Thursday’s trading, and fell to its lowest level in three months against the dollar. وسجلت Turkish lira A decline in its value by 1.5 percent, after a decision central bank By cutting interest rates by 100 basis points to 18 percent, according to “Reuters”.
The decision led to the depreciation of the Turkish lira to a level close to the record low, as its price reached 8.808 against one dollar.
The decision came in contrast to the expectations of experts who expected the bank to keep its monetary policy unchanged as a result of the rise in rates inflation.
The Turkish economy is facing a crisis of mistrust from investors due to the dispute over the central bank’s work mechanism, which has led to increased pressure on the lira and high prices that pushed inflation to 19.25 percent, the second highest rate in the world. G20.
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Inflation as a dilemma the Central Bank is trying to deal with, as the bank’s president hinted earlier, keeping the interest rate higher than the real inflation rate, that is, the rate that excludes food prices, a rate that recorded 16.76 percent last August.
Turkey’s dilemma is that the depreciation of the lira increases the burden of repaying foreign debts, which amount to about $169 billion and mature within a year or less.
The other danger he faces Turkey, is the Federal Reserve’s tendency to tighten monetary policy, which means higher yields on US assets, and damage to emerging market currencies, especially for countries burdened with foreign debt such as Turkey.