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Erdogan says he will keep battling interest rates, hitting lira

Erdogan says he will keep battling interest rates, hitting lira
November 17, 2021 Web Desk

ANKARA (Reuters) – Turkish President Tayyip Erdogan said on Wednesday he will continue his battle against interest rates "to the end" in order to protect people, sending the lira to new depths a day before a central bank meeting at which it could slash rates further.

In the comments that sent the currency as low as 10.565 to the dollar, a new record, Erdogan said he will lift the interest rate burden from people and urged business owners to invest, hire and raise exports.

Erdogan, a self-described enemy of interest rates who is seen to influence monetary policy, repeated his unorthodox view that rates were the cause of inflation and questioned why some of our "friends" defended tight policy.

"We will lift this scourge of interest rates from people's backs. We certainly cannot allow our people to be crushed by interest rates. We will not accept this," he said.

The lira shed about 1.5% in response to the president's comments, plunging deeper into uncharted territory after what analysts have called premature and risky monetary easing.

The central bank has cut its policy rate by 300 basis points since September, against expectations, even as inflation continued to climb to near 20%, delivering stimulus long sought by Erdogan.