Erdogan Maintains Economic Policy Amid Rapidly Increasing Inflation

  • Share

The Turkish economy faced a difficult year as the value of the currency continued to decline and inflation in the country rose sharply.

Experts warn that the situation will only get worse if President Recep Tayyip Erdogan does not change course and reverse his controversial monetary strategy.

Last week, the Turkish Statistical Institute (TUIK), the country’s official statistics agency, reported that inflation soared to 36 percent last month, Turkey’s highest achievement in nearly two decades.

The opposition party said the actual situation was worse than the official figures circulating.

Following a series of rate cuts by the Central Bank of the Republic of Turkey last year, the Turkish currency lost 50 percent of its value before finally recovering some after a series of measures announced by the government in the final weeks of 2021.

Financial experts and opposition parties inside and outside Turkey claim this is because President Erdogan insists on continuing to cut interest rates.

Most economists argue that in order to stop inflation, the Federal Reserve should increase the main interest rate. But Erdogan rejects such a strategy, arguing that low interest rates will lower inflation and boost growth, despite growing evidence that his policies are ineffective. [jm/em]

  • Share

Leave a Reply

Your email address will not be published. Required fields are marked *