Turkish central bank deputy governor to resign as crisis deepens

Marco Green
September 4, 2018

The lira strengthened by more than 2 percent after the announcement and decreased to trading at 6.51 against the dollar.

The embattled lira had tumbled nearly 5 per cent in value on Thursday, trading at around 6.7 to the dollar, amid mounting concerns over the resignation of the deputy central bank governor.

The president has long exerted pressure on the central bank to keep rates lows to encourage growth.

President Erdogan, who calls himself "the enemy of interest rates", has been trying to promote rapid growth to counter high currency inflation and the lira having depreciated more than 40 percent against the dollar this year.

Erkan Kilimci, Turkey's Central Bank deputy governor and ratesetter, is leaving the bank Reuters reported today.

This should open the way for Erdogan to choose a figure of his own choosing as new deputy governor.

"With this development (the resignation of Kilimci) fuelling concerns over Turkey?s fragile financial system, the lira could be set to extend losses", Lukman Otunuga, Research Analyst at FXTM, told AFP. Yes, six-zero. Domestic problems in the two countries have not been helped by the United States. The fears triggered a plunge in the currencies of multiple developing economies.

While the lira is still above the record lows it reached earlier in August, further decline could force the country's central bank to take additional action.

Other reports by Click Lancashire

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