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Turkey’s central bank dismisses chief economist, department managers: report

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Turkey’s central bank has dismissed its chief economist, Hakan Kara, and some department managers, according to a document seen by Reuters, re-igniting concern about political interference in the institution one month after the sacking of its governor.

The decision was part of a reorganization to make the bank more effective, according to the document, and was taken at an internal bank meeting. It followed comments from President Recep Tayyip Erdoğan in July that the bank needed to be overhauled.

Also dismissed were the bank’s research and monetary policy general manager, Pinar Özlu; markets general manager Orhan Kandar; and banking and financial institutions general manager Yavuz Yeter, the document showed. Kara and the general managers were all given the role of advisers.

The document did not identify a new chief economist but named several people as being appointed to fill vacancies in the bank’s economics team after the changes. More than 10 people were dismissed in total.

The document said the reorganization was carried out to facilitate “the effective performance of duties, the effective management of operations and the clear definition of departments areas of responsibility.”

Last September, former Governor Murat Çetinkaya raised interest rates by 625 basis points to stem a currency crisis. Rates remained at 24 percent this year, preventing further losses in Turkey’s lira but helping push the economy into recession.

He was sacked last month by Erdoğan, who said he failed to follow instructions on interest rates and the bank had not properly fulfilled its role.

At its first meeting under it new governor, Murat Uysal, this month, the bank’s monetary policy committee slashed its key interest rate by 425 basis points to 19.75 percent.

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