Turkey has almost doubled interest rates, in the first sign that President Recep Tayyip Erdogan may be reversing some of his unorthodox economic policies.
Erdogan insisted on keeping interest rates low, claiming that high interest rates are what stoke inflation. Inflation in Turkey has been extremely high in recent times.
Annual inflation is currently about 40%, but was as high as 80% at the end of last year. The Turkish lira has also lost significant value in recent years.
Despite these economic setbacks, Erdogan was re-elected as Turkish president last month.
Interest rates were raised this week from 8.5% to 15%, which was lower than the consensus forecasts by economists.
The Turkish central bank said that the increase in interest rates would be a gradual process, as it seeks to bring the country’s inflation down to 5%.
The central bank is now on its fourth governor in two years, as Erdogan fired those who tried to implement orthodox economic policies.
[Image: Gerd Altmann from Pixabay]