“The Turkish president does not deviate from the policy of low interest rates. This diminishes the purchasing power of the Turks. “And the opposition sees victory on the horizon,” writes the website of the Frankfurter Allgemeine Zeitung, entitled “Erdogan’s struggle against markets.”
“Tayyip Erdogan’s obsession with low interest rates has three reasons: The construction sector is one of the Turkish president’s top financial backers. The president commissioned public works on construction and they gave growth to the economy. Today, however, many newly built buildings remain vacant and low interest rates help the construction sector overcome the difficult period.
The second reason is small and medium-sized businesses, traditional AKP voters.
Third are the country’s export companies, which are the only ones now able to boost growth and create jobs. And they benefit from low interest rates.
But President Erdogan can not silence the markets or impose them. “Both the continuing devaluation of the pound and the spike in inflation are trapped in a vicious circle.”
DW – Stefanos Georgakopoulos
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