A Turkish man stands in front of a foreign exchange shop on January 28, 2014 in Istanbul. (AFP PHOTO/GURCAN OZTURK)
Your feedback is important to us!
We invite all our readers to share with us their views and comments about this article.
Disclaimer: Comments submitted by third parties on this site are the sole responsibility of the individual(s) whose content is submitted. The Daily Star accepts no responsibility for the content of comment(s), including, without limitation, any error, omission or inaccuracy therein. Please note that your email address will NOT appear on the site.
Alert: If you are facing problems with posting comments, please note that you must verify your email with Disqus prior to posting a comment. follow this link to make sure your account meets the requirements. (http://bit.ly/vDisqus)
A massive rate hike may have stalled the Turkish lira's fall and salvaged the central bank's credibility, but it stunts growth at a politically fraught time for Recep Prime Minister Tayyip Erdogan and may not shield Turkey from a fragile global backdrop for long.The boldness of the actions stunned investors, propelling the lira to its biggest one-day gain in more than five years and stirring hopes it would short-circuit a vicious cycle of selling in emerging markets.Erdogan, keen to maintain growth ahead of an election cycle starting in two months, has been a vociferous opponent of higher borrowing costs, railing against what he describes as an "interest rate lobby" of speculators seeking to stifle growth and undermine the economy.Finance Minister Mehmet Simsek played down the impact on growth, saying the country's economy would have suffered greater damage if the credibility of the central bank had been undermined.The central bank's rate hike despite Erdogan's opposition to the move helps the case that institutions still function independently.
FOLLOW THIS ARTICLE