© Reuters. The lira loses 3% after the relief of Turkey’s finance minister
Istanbul, Dec 2 (.) .- The Turkish lira fell 3% this Thursday, reaching a new historical low, trading at 15.5 units per euro and 13.7 per dollar at the end of a day marked by the replacement of the Minister of Finance, Lütfi Elvan, by the up to now Deputy Minister Nureddin Nebati.
The change at the top of the Treasury did not immediately cause movements in the currency market, since the Turkish currency remained at higher values than the previous day during practically the entire session.
It was only shortly before the close of the Istanbul Stock Exchange, after 15:00 GMT, that the lira lost value again until it was below the previous all-time low, registered on Tuesday.
Upon taking office at noon, Nebati announced his intention to maintain the low interest rate policy demanded by Turkish President Recep Tayyip Erdogan, a strategy that is, according to analysts, the main reason for the sharp depreciation of the lira and high inflation, which is already close to 20%.
The central bank has cut rates three times since September and currently maintains them at 15%, although the bank’s governor, Sahap Kavcioglu, said today that the margin for further cuts is “largely exhausted.”
The Bank announced on Wednesday that it intends to correct the “unhealthy” values of the foreign exchange market by means of specific buying and selling interventions in the derivatives market VIOP, which is part of the Istanbul Stock Exchange, although it has not specified the volume of money destined to these actions.
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