Turkey's Central Bank

President Tayyip Erdogan on Friday appointed Hafize Gaye Erkan, a finance executive in the United States, to head Turkey's central bank, which is widely expected to reverse course and tighten policy after years of rate cuts and a simmering cost-of-living crisis.

The Turkish lira, which fell today by more than five percent, hit a new historic low against the dollar ten days after the re-election of President Recep Tayyip Erdogan, reported AFP.

Turkish President Tayyip Erdogan said on Friday that interest rates will fall as long as he is in power, and that inflation will decline with them, repeating his unorthodox views.

Erdogan was speaking in Istanbul weeks before a presidential election on May 14. Some anticipate a shift to more orthodox policies after the vote.

The Central Bank has not changed its 2023 inflation forecast and maintained its year-end consumer price index at 22.3 percent.

Turkish inflation rose year-on-year in June to a 23-year high of 78.62%, its acceleration for the 13th consecutive month boosted by the weakness of the local currency (the Turkish lira) and the negative effects of Russia's military invasion of Ukraine, which are expressed in a continued strong increase in the prices of raw materials.

Turkey's Central Bank has lifted its annual consumer price inflation forecast for 2022 from 23.2 percent three months ago to 42.8 percent.

The bank, which unveiled its quarterly inflation report yesterday, said it also revised upwards its end-2023 forecast from a previous 8.2 percent to 23.2 percent. It expects the annual inflation rate to ease to 8.3 percent at the end of 2024.

Turkey's central bank on Jan. 20 has kept interest rates steady on Jan. 20. 

The bank left its policy rate at 14 percent two days after President Recep Tayyip Erdoğan - a fervent opponent of high interest rates - said future reductions could come "gradually and without any rush".

Turkey and Qatar Dec. 7 signed 15 agreements, including in various fields such as military, health, tourism, and education, to enhance bilateral cooperation between the two countries during a visit of President Recep Tayyip Erdoğan to Doha.

Turkey's Central Bank on Dec. 1 intervened to prop up the value of the Turkish Lira.

Spontaneous protests took place in Istanbul and Ankara after the collapse of the Turkish lira, Hulk TV reported.

The protesters demanded the resignation of the government and the resignation of the ruling Justice and Development Party. The police dispersed the demonstrators.