© Reuters. The Turkish lira recovers 5% after the sharp fall on Tuesday
Istanbul, Nov 24 (.) .- The Turkish lira closed the trading day on Wednesday with a gain of 5% compared to yesterday’s close and has stood at around 13.7 units per euro and 12.2 per dollar, after that on Tuesday it plummeted 11% to its all-time low.
Although the Turkish currency continued its downward path this morning, reaching 14.7 units per euro shortly after the markets opened, it recovered throughout the day and even reached 13.2, although it later returned to lose part of what was gained.
Tuesday’s historic collapse, which even prompted a Central Bank statement to warn against businesses with securities “unrelated to economic bases,” began on Monday afternoon during a speech in which the country’s president, Recep Tayyip Erdogan , defended the policy of low interest rates.
Last Thursday, the Central Bank cut rates from 16% to 15%, well below year-on-year inflation, which is close to 20%.
This policy has led to a devaluation of the lira that triggers consumer prices, because even Turkish local products depend on the foreign exchange market, due to the fact that the country imports many raw materials, in addition to fuel and energy.
Citizen discontent has motivated several citizen protests both yesterday and today, with protests in Ankara and Istanbul, dispersed by the police using tear gas.
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