The Turkish central bank has decided to reduce its key interest rate by one percentage point to 14%, while saying it will end the cycle of interest rate cuts.
Inflation in Turkey is higher than 21% and is rising steadily as President Recep Tayyip Erdogan has refused to raise interest rates, leading to a sharp drop in Turkish purchasing power.
The Turkish currency has lost 50% of its value against the dollar since the beginning of the year.
Investors and economists have called for a policy change from Erdogan, who has so far insisted that higher interest rates increase inflation rather than lower it, as is the widely accepted economic view.
The rate cut was followed by a series of other cuts by the central bank, which said it had intervened in the foreign exchange market on Monday, selling dollars to support the pound.
The pound fell after the announcement of interest rates at a new low of 15.51 pounds against the dollar.
As it transmits SKAI’s correspondent in Istanbul, Manolis Kostidis, the Turkish president is expected to announce the rate of increase of the basic salary, which may be affected due to the devaluation of the pound.
It is noted that today the Turkish citizen is paid a basic salary of 169 euros.
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