Turkish Central Bank Governor dismisses resignation rumors

Turkish Central Bank Governor Erdem Ba?ç? sought to calm jittery investors on Feb. 27, dismissing rumors that he would resign and giving a brief lift to the lira currency after it tumbled to a record low.
   
Ba?ç?'s future, and the independence of the central bank, have been a concern for investors since President Tayyip Erdo?an stepped up criticism of the bank this week after it failed to meet his demand for bigger rate cuts.

Speaking at a lunch for provincial governors on Feb. 27, Erdo?an did not mention the bank's latest rate decision but repeated his view that high interest rates amounted to a betrayal of the nation.
 
"Selling out the country would be to waste its resources through mismanagement, high interest rates and high inflation," he said in a speech ostensibly about Syria and a Kurdish peace process, but in which he listed various forms of betrayal.
   
"Serving the country means lowering inflation and interest rates to allocate that resource to investments for the country and people," he said.
   
In a further sign of the pressure Ba?ç? faces, Economy Minister Nihat Zeybekçi was quoted as saying that the bank's main interest rate should be cut to 6 percent from 7.5 percent as borrowing costs were "not tolerable."

Ba?ç?, who was absent from work on Feb. 26, said that was due to a health check-up which not reveal any serious problems, and was not a sign of an imminent departure, as some market participants had feared.

"A public duty is performed for the period it is assigned and it is performed in the best way. As our health allows, we will continue to fulfil the requirements of this duty," he said in comments broadcast by CNN Türk.
   
That initially helped the lira recoup some losses....