Turkey tightens controls over national currency to initiate growth: report

0
(PHOTO: AFP)

Turkey has further tightened controls imposed on the lira as it pushes ahead with efforts to manage the country’s currency even as it cuts interest rates and seeks a return to fast-paced growth, the Financial Times reported.

The banking regulator announced curbs on Sunday night aimed at limiting currency speculation by foreign traders after the lira weakened beyond 6 to the dollar on Friday — the first time that it has crossed the symbolic threshold since May. The Turkish lira in early Monday trading strengthened 0.4 percent against the dollar to TL 5.98.

The latest move expands controls introduced during a currency crisis that struck the country in August 2018. It lowers the size of currency swaps and other similar transactions between Turkish banks and foreign counterparts from 25 percent of the bank’s regulatory capital to 10 percent.

Turkish authorities have taken an increasingly interventionist approach to managing the currency since 2018, when President Recep Tayyip Erdoğan took the helm of a powerful new system of governance and vowed to take a more active role in the country’s economic management.

Liked it? Take a second to support Turkish Minute on Patreon!

LEAVE A REPLY