Turkish Lira Plummets To Over 4-month Low Versus U.S. Dollar After Firing Of CB Governor
21 Marzo 2021 - 9:47PM
RTTF2
The Turkish Lira plunged against the U.S. dollar on Monday, as
President Tayyip Erdogan ousted Turkey's central bank chief Naci
Agbal for hiking interest rate to contain double-digit
inflation.
Over the weekend, Erdogan announced that he had removed Naci
Agbal and Sahap Kavcioglu will become new central bank
governor.
The move came two days after the Central Bank of the Republic of
Turkey hiked its benchmark policy rate by 200 basis points to 19
percent to tame its high inflation rate.
Kavcioglu, who was a lawmaker in Erdogan's ruling party, favors
a lower rate policy.
In a statement on Sunday, the central bank said it "will
continue to use the monetary policy tools effectively in line with
its main objective of achieving a permanent fall in inflation".
Erdogan's decision rattled markets, which welcomed a tighter
monetary policy to help stabilize inflation.
The Turkish Lira fell 15 percent to 8.2882 against the
greenback, its lowest since November 2020.The pair had ended last
week's trading at 7.1956. The Lira is likely to find downside
target around the 8.5 level.
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