Lira's lapse in news excerpt: Erdogan threatens central bank after massive interest rate hike

  • For weeks the Turkish lira quickly lost value
  • Accusing remarks by President Erdogan accelerated the decline
  • For the first time now entered the central bank of the country and increased interest

16:34: The German economy calls on Turkey to relax trade barriers with a view to the decline of the lira. "Export revenues must now be converted into at least 80 per cent Turkish lira, which does not appeal to foreign investors," said the German Chamber of Commerce and Industry (DIHK), Eric Schweitzer, the German news agency. It would also be important for Turkey to make a clear commitment to the customs union rules with the EU.

On Friday, a German-Turkish economic dialogue of the DIHK will take place in Berlin to promote the exchange after difficult months. Especially the lire decline makes many companies into a company. "In the past four months, our export to Turkey is already declining."

"Signals of stability are needed, such as legal certainty or central bank independence," says Schweitzer. "The companies are waiting for strong signs from the Turkish government to restore lost confidence."

Erdogan threatens central bank after mass rate hike: "My patience has limits"

Friday, September 14, 2018, 12:02 pm: Turkish president Recep Tayyip Erdogan has once again criticized the monetary policy of the Turkish central bank. A day after a sharp rise in interest rates by the central bank, Erdogan said Friday before party supporters, his patience with the monetary policy of the monetary guardians has limits. The interest rates are now "pretty high". "We will see the results of independence," Erdogan said, referring to the formal independence of the Turkish central bank of political leadership.

On Thursday, the Turkish central bank sharply increased its main interest rate by 6.25 percentage points to 24 percent, although Erdogan had publicly claimed lower interest rates a few hours earlier. After the rate hike, the local currency lira rose strongly, while it had fallen sharply in the weeks and months before. Erdogan is a declared opponent of high interest rates. However, economists consider it essential to combat the current lira crisis.

IMF very worried: trade war would plunge Turkey into the abyss (video)