Arab Today, arab today turkey raises overnight rate to support economy
Last Updated : GMT 06:51:35
Arab Today, arab today
Arab Today, arab today

Turkey raises overnight rate to support economy

Arab Today, arab today

Arab Today, arab today Turkey raises overnight rate to support economy

Ankara - AFP

The Turkish central bank raised its overnight rate by 0.75 percentage points to 7.25 percent on Tuesday, as it fights to support its currency from a flight of foreign capital. But the bank held its key rate at 4.5 percent, the level to which it was reduced in May. But a week ago, the bank hinted that it might now have to tighten monetary policy to shore up the lira. \"If necessary, more measures will be taken,\" the bank said. Turkey has achieved strong economic growth in the last decade after severe financial crisis and IMF rescues, and is now an economic powerhouse in its region. The economy is estimated to be about the 17th-biggest in the world. But it is also extremely vulnerable to rapid flows of foreign capital and has been hit hard by talk of central banks in the US and elsewhere winding up stimulus policies that have encouraged investors to Turkey\'s door. With the economy now sputtering, and after a wave of demonstrations sparked at least in part by a frustrated middle class, the central bank has been under strong pressure from the government to hold rates down.\"By tightening policy, the central bank is simply bowing to the inevitable - in times of market turbulence countries with large current account deficits, such as Turkey, need high interest rates,\" said Neil Shearing, Chief Emerging Markets Economist. And following the decision, the lira strengthened, \"but nonetheless, Turkey\'s current account deficit leaves it vulnerable to a fresh deterioration in investor sentiment,\" Shearing said. The Turkish Lira has been under the gun ever since the US Federal Reserve alarmed the world with talk that it would scale back easy money monetary stimulus. In its rapid effort to support the lira, the central bank sold nearly $6 billion in operations economists say Turkey can only sustain for a limited time. \"Movements in the lira will be critical to determining what happens next,\" Shearing said. The currency crash last month coincided with unprecedented street protests against the Islamist-rooted government of Recep Tayyip Erdogan that sent the stock market in Istanbul plummeting. At that time Erdogan attacked those whom he termed speculators, and the interest rate lobby, meaning people who argued that an increase in rates was needed to shore up the lira and encourage capital to stay. Erdogan\'s Justice and Development Party (AKP) gained power in 2002. Since then, the economy has recovered with strong growth exceeding 8.0 percent in 2010 and 2011. The government was counting on far slower growth of 4.0 percent this year. Turkey does about half of its external trade with the eurozone and has suffered from weak growth and domestic demand in Europe. The country is running a structural trade deficit estimated at 6.3 percent of gross domestic product this year.

arabstoday
arabstoday

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today turkey raises overnight rate to support economy Arab Today, arab today turkey raises overnight rate to support economy

 



Arab Today, arab today

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today turkey raises overnight rate to support economy Arab Today, arab today turkey raises overnight rate to support economy

 



Arab Today, arab today Designer prepared new set of ornaments

GMT 02:45 2017 Wednesday ,28 June

Designer prepared new set of ornaments
Arab Today, arab today France defies terrorism through tourism

GMT 15:18 2017 Saturday ,20 May

France defies terrorism through tourism
Arab Today, arab today Mai Al-Jeddawi presents décor ideas for Ramadan
Arab Today, arab today
Arab Today, arab today

GMT 08:23 2017 Saturday ,24 June

Actress Feryal Yussef received new drama offers

GMT 09:49 2017 Tuesday ,02 May

Girl barred from Malaysia chess competition

GMT 08:48 2017 Saturday ,06 May

Climate science: Bad news gets worse

GMT 16:25 2017 Sunday ,04 June

“Suhoor” is basic meal for fasting

GMT 06:31 2015 Thursday ,04 June

Pluto's unruly moons

GMT 11:09 2017 Sunday ,25 June

HUAWEI P10 the ‘guru’ of portrait shots

GMT 17:59 2017 Monday ,12 June

Designer Rania Adel reveals her new collection
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday