Turkish President Recep Tayyip Erdogan has promised to continue lowering interest rates

(Bloomberg) – Turkish President Recep Tayyip Erdogan has promised that the country will continue to cut interest rates, followed by low inflation.

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“We will lower interest rates as we have already done,” Erdogan said after the Turkish central bank suspended its interest rate cuts of 500 basis points since September.

The period of aggressive softening was accompanied by fugitive inflation, which provoked protests among the Turks, who had witnessed a deep erosion of purchasing power for several months.

“We are aware that inflation is a serious burden for citizens,” Erdogan said in the northern province of Giresun on Saturday. “I repeat here because you already know my struggle against interest rates; we will lower interest rates as we have already done. Inflation will also fall.

Contrary to what most economists believe, the Turkish president has been a vocal supporter of the theory that low interest rates have led to lower inflation. The Turkish experience did not support Erdogan’s opinion. After the central bank began a period of interest rate cuts in line with Erdogan’s demands, the pound fell to a record low and inflation reached its highest level in 19 years.

Turkey has said that inflation will reach 40% in 2022

Turkey will release its January inflation data on Thursday. According to a survey conducted by Bloomberg among 16 analysts, annual inflation is expected to rise to 48%.

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