Workers shout slogans as they demonstrate to protest against the government's labour and economy policies in Ankara on February 4, 2015. AFP PHOTO / ADEM ALTAN
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The slumping Turkish lira is complicating calculations of central bank Governor Erdem Basci as he confronts mounting political pressure to speed up the pace of interest-rate cuts. While a more than 50 percent slide in crude prices since June has helped cool consumer-price growth to the slowest in two years, the lira's drop to successive records this month is undoing some of oil's work. Each 10 percent slide in the lira translates into as much as a 1.5 percentage-point increase in consumer-price growth, according to Standard Chartered Plc.Amid criticism from Erdogan and his political allies, Basci kept monetary policy tied to consumer prices, waiting six months for signs of a weakening inflationary trend before cutting the benchmark one-week repurchase rate by 50 basis points to 7.75 percent last month.Consumer-price inflation slowed by 0.93 percentage point to 7.24 percent last month, the lowest level since May 2013 .
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