As lira hits record lows, Turkey's Erdogan cites attack on economy

[Baybars Han]

The current power also created a strong sovereign wealth fund. Beside this the central bank has a huge dollar reserve. They cant collapse the Turkish economy that easy anymore..

Is this guy serious? This guy is beyond stupid.

 

[Kamil_baku]

China has been investing a lot of money into renewable energy, three times that of the US. China is also making a lot of grounds in automation and artificial intelligence. It is incorrect to say that coal gives China an advantage of Turkey when in reality it is technology.

Dude, just look 30 years back, look at my eyes and tell me...
COuld you even talk about technology at that time? its ground truth that WHat made China big is the coal reserves...
It was obvious and was mentioned even 30 years ago by US that with the money you make, you will eventually invest in other businesses...
unfortunately its free to troll here

 

[UkroTurk]

Huge dollar reserves out of blue could be disappeared according to loans to foreign creditors and when the time to buy oil, raw materials for national industry came.

http://m.t24.com.tr/haber/mahfi-egilmez-yazdi-turkiye-2018de-ne-kadar-dis-borc-odeyecek,524299

https://www.google.com.ua/amp/tr.euronews.com/amp/2017/09/30/dis-borc-milli-gelir-turkiye-ic-borc

You will have to pay your national dept and energy bill by USD.
Turkish industry is based on producing intermediate goods which are bound to export raw materials.
Turkey cant produce a lot of strategical raw materials which turkish industry needs, Turkey imports them.

 

[Killuminati]

Is this guy serious? This guy is beyond stupid.

Explain.

 

[Baybars Han]

Explain.

Your 100+ billion dollar reserve will melt like butter if you try to save it with your reserves. Saudi Arabia with its 500 billion or Russia couldnt/ can not save theres. Do you think that is any significant reserves?

What sovereign wealth fund are you talking about? Norways sovereign wealth fund? We don't have a sovereign wealth fund to speak of and how is that going to save the currency?

Our only weapon left is interest rates, but because your stupid to not understand how it works you won't understand. If Erdoğan says interest rates are bad for you that is God's words.
Increasing interest rates means money coming in, increasing the value of the currency. When Russia was struggling very bad a few years ago and the rouble sinking they had to increase interest rates by like 10 points to save the currency which worked eventually.

Inflation is another problem

Long term we need to focus on
1. Reducing account deficit
2. Selling higher value goods and increasing export

 

[Killuminati]

Your 100+ billion dollar reserve will melt like butter if you try to save it with your reserves. Saudi Arabia with its 500 billion or Russia couldnt/ can not save theres. Do you think that is any significant reserves?

What sovereign wealth fund are you talking about? Norways sovereign wealth fund? We don't have a sovereign wealth fund to speak of and how is that going to save the currency?

Our only weapon left is interest rates, but because your stupid to not understand how it works you won't understand. If Erdoğan says interest rates are bad for you that is God's words.
Increasing interest rates means money coming in, increasing the value of the currency. When Russia was struggling very bad a few years ago and the rouble sinking they had to increase interest rates by like 10 points to save the currency which worked eventually.

Inflation is another problem

Long term we need to focus on
1. Reducing account deficit
2. Selling higher value goods and increasing export

You learned one or two general terms and acting here like you know what you are talking about. You are one dumb fk blinded by Erdogan hate.

Yeah "rising interest means money coming in..." roflmao get lost dude your words dont make any sense

 

[SouI]

Yeah "rising interest means money coming in..." roflmao get lost dude your words dont make any sense

Well he is right, that is what it means.

What @Baybars Han doesnt take into account though is that these individuals/companies/countries that will bring their döviz into our country for a profit, will eventually take that money out of the country again to actually get their profit due to high interest rates. That means our currency would temporarily gain some value while in the long term it would lose far more value than if this money never flowed into the economy.

So I think AKP is doing the right thing keeping interest rates as low as possible.

 

[Baybars Han]

You learned one or two general terms and acting here like you know what you are talking about. You are one dumb fk blinded by Erdogan hate.

Yeah "rising interest means money coming in..." roflmao get lost dude your words dont make any sense

Wow, your more stupid that I thought

 

[KapitaanAli]

Yeah "rising interest means money coming in..." roflmao get lost dude your words dont make any sense

Well he is right, that is what it means.

What @Baybars Han doesnt take into account though is that these individuals/companies/countries that will bring their döviz into our country for a profit, will eventually take that money out of the country again to actually get their profit due to high interest rates. That means our currency would temporarily gain some value while in the long term it would lose far more value than if this money never flowed into the economy.

So I think AKP is doing the right thing keeping interest rates as low as possible.

The problem is that Turkish industries rely a lot on imports. So all this credit given by Erdoğan is ending up in Europe anyway.

It's great to have good growth like Turkey, but if it's based on too much credit that feeds a growing account deficit, it's a bubble.

 

[Elvin]

Buy more gold and peg the TL against gold or other precious metals.

 

[asena_great]

As lira hits record lows, Turkey's Erdogan cites attack on economy

Daren Butler, David Dolan

ISTANBUL (Reuters) - The Turkish lira sank to record lows on Wednesday, battered by investor concern about monetary policy and inflation, a sell-off that President Tayyip Erdogan dismissed as an economic attack by enemies of the state.

A man checks currency exchange rates at a currency exchange office in Istanbul, Turkey April 11, 2018. REUTERS/Murad Sezer
The lira, one of the worst-performing emerging market currencies this year, has hit record lows for the last five trading days. It has also been pressured by a rouble sell-off and by the possibility of a U.S. missile strike on Syria. Russia, Syria’s main ally, is a major trading partner of Turkey.

Investors say the bulk of Turkey’s problems are homegrown, pointing to worries that Erdogan has excessive influence on monetary policy. A self-described “enemy of interest rates”, he has repeatedly called on the central bank to lower rates to boost growth, even though inflation in running at double digits.

The bank’s reluctance to tighten policy - it held rates steady at its last two meetings - has only increased the perception that it is under political pressure.


“The markets at the moment really want to see a rate hike by the central bank, as a sign that it is still a credible institution; that it’s taking its inflation targeting somewhat seriously and that it is prepared to stand up to government pressure,” Capital Economics senior emerging markets economist William Jackson said.

The lira hit an all-time low of 4.1944 against the dollar, a depreciation of 9.4 percent this year. Against the euro, it fell to a record low of 5.1914.

A board showing foreign currency exchange rates against Turkish lira is on display at a currency exchange office in Istanbul, Turkey April 11, 2018. REUTERS/Murad Sezer
It recouped some losses and was trading at 4.1525 against the dollar by 1340 GMT, after Prime Minister Binali Yildirim said the central bank would take “necessary measures”.

HANDS TIED
“The central bank is responsible for monetary policy... it took the necessary measures until now, and it will continue to do so,” Yildirim said in a speech. He did not elaborate on what the measures might entail.

Data released on Wednesday showed the current account - a broadly defined measure of trade that includes services and investment income - recorded a deficit of $4.152 billion in February.


That was less than the $4.2 billion forecast in a Reuters poll, but a more than 60 percent increase from the same period a year earlier. One analyst said it affirmed Turkey’s vulnerabilities on the balance of payments front.

“(It) underlines the challenges for the CBRT (central bank) in managing the lira when Erdogan has tied both hands behind its back in terms of limiting its ability to hike policy rates,” Bluebay Asset Management strategist Timothy Ash said.

The central bank holds its next rate-setting meeting on April 25. Anything less than a decisive rate hike is likely to put further pressure on the lira, analysts have said.

Erdogan characterised the sell-off as an attack by Turkey’s enemies, an argument that resonates with many of his supporters.

“There are games being played on our economy,” he said in a speech in Ankara. “I call to those attacking our economy: You will not succeed. Just like you failed before, you will fail again.”

Such commentary is unlikely to help investor sentiment, Capital Economics’ Jackson said.

“If it’s described as an attack on the economy, it suggests that there’s not a discussion about what might need to change in terms of monetary and fiscal policy,” he said.

The cost of insuring Turkish debt spiked to a 4-1/2 month high, while dollar bonds fell across the curve.


Turkish five-year credit default swaps rose to 215 basis points (bps) according to data from IHS Markit, the highest level since mid-November, and up 6 bps from Tuesday’s close.

The main BIST 100 share index dropped 1.6 percent, adding to 2.16 percent drop on Tuesday.

Additional reporting by Claire Milench in London; Tuvan Gumrukcu in Ankara and Ezgi Erkoyun in Istanbul; Editing by Louise Ireland

Our Standards:The Thomson Reuters Trust Principles.

https://www.reuters.com/article/uk-...to-record-lows-bond-yields-rise-idUSKBN1HI159

from what i heard 1 dollar in iran is more then 6tl wouldn't it have been better if you opened a thread about your country as well ???