Erdoğan on interest rate hike: My patience has limits

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President of Turkey and leader of the Justice and Development Party (AK Party) Recep Tayyip Erdogan delivers a speech during AK Party's extended meeting of provincial heads in Ankara, Turkey on September 14, 2018. / AFP PHOTO / ADEM ALTAN

Turkish President Recep Tayyip Erdoğan reacted angrily on Friday to a crucial interest rate hike announced by the country’s central bank, stating that his patience has limits with regard to the results of the bank’s independence, the T24 news website reported.

The central bank on Thursday increased interest rates by 625 basis points, with the result that Turkey offers the second highest interest rates in the world, at 24 percent.

“Let’s see the [bank’s] independence! We will see the results. This phase is my patience phase. And it has limits,” Erdoğan said at a meeting of his Justice and Development Party (AKP) in Ankara.

He had also criticized supporters of an interest rate hike just before the bank’s decision, making his stance as an “enemy of high interest rates” clear once again.

After the increase, the Turkish lira firmed at 6.1 to the US dollar, a sign of recovery as the currency had lost its more than 50 percent of value since the beginning of the year.

Erdoğan, however, said the currency’s current value was a consequence of a direct “economic attack” by the US following a row between the two NATO allies over the continued detention of American pastor Andrew Brunson on terror charges.

According to BlueBay Asset Management strategist Timothy Ash, Erdoğan was convinced to give his approval to a high increase in interest rates by his son-in-law, Treasury and Finance Minister Berat Albayrak, who recently went to London to meet global money managers and listened to their opinions about the Turkish economy, the Financial Times reported.

President Erdoğan also slammed retailers who increased prices due to the currency crisis.

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