The Turkish pound is in tartar, the day after Erdogan assured that the country will not change monetary policy. The opposition is furious. Reactions from the citizens.
The Turkish currency, which continues to suffer one record drop after another, collapsed once again yesterday Tuesday (23/11), reaching a new all-time low, with its exchange rate against the US dollar falling almost to 13: 1, plunging the country a little deeper into the economic crisis it is experiencing.
According to the Athenian and Macedonian News Agency, at noon, the new Turkish pound was in the Tartars, lost 15% and its exchange rate against the US dollar briefly exceeded the level of 13.45: 1.
It closed with the biggest drop since August 10, 2018.
Its downfall came amid assurances from Turkish President Recep Tayyip Erdogan that the country would not change its monetary policy, but would continue to "resist pressure" from those pushing for higher interest rates.
On Monday night (22/11), leaving a cabinet meeting, the head of state went so far as to denounce a "conspiracy" against the Turkish economy.
"We clearly see the game of some with exchange rates, with currencies, with interest rates, with price increases," he said.
His placement inevitably contributed to the collapse of the Turkish currency a few hours later. A development that was recorded while already, for a large part of the population, the cost of living is unbearable. Some are trying to save money in gold, as inflation has officially reached almost 20% since the beginning of the year.
As for the Turkish employee, the net minimum wage shrank from $ 380 (almost 338 euros) in January to $ 224 (199 euros) yesterday at the day's exchange rate.
Last Thursday, the Turkish central bank cut its benchmark interest rate again - for the third time in less than two months - from 16% to 15%, as claimed by the Turkish president, who has always expressed hostility to high interest rates. According to him, it is an obstacle to economic development, a view that is not exactly in line with current economic orthodoxy.
According to Timothy As, a BlueBay Asset Management analyst in Turkey, President Erdogan "has lost control. Zero governance, zero credibility. There is no longer a central bank at the helm. "
The head of state of Turkey, whose popularity is at an all-time low in his 19 years in power, seems to be pursuing economic growth at all costs, apparently hoping to be re-elected in 2023. Reducing interest rates - such as Mr. Erdogan sees it - it will make Turkish exports cheaper, it will help make investments, it will create jobs.
Lack of independence
But the country's monetary policy has come under fire, mainly for its lack of central bank independence, with the currency increasingly falling to new lows against the US dollar - and with the most painful tangible consequence of rising prices. imports.
For many Turks, the relentless fall in the value of the currency and the sharp rise in prices, sometimes from hour to hour, mean that they have to take everything into account, from whether they are going on holiday to what they are buying to make ends meet.
The Turkish opposition is furious.
"Such a catastrophe has never occurred in the history of democracy," said Kemal Kilicdaroglu, the leader of the Republican People's Party (CHP), blaming President Erdo Τουan for the free fall of the pound. According to Mr. Kilicdaroglu, the head of state has become a "national security problem" for Turkey.
For former Prime Minister Ahmet Davutoglu, a founding member of the president's Islamist Justice and Development Party (AKP), who has now left and founded his own party, the measures taken by Recep Tayyip Erdogan are "betrayal" and "not ignorance".
Opposition leaders convened special meetings of their party bodies to discuss the new collapse of the pound, the second worst in history.
For Craig Erlam, an analyst at OANDA investment platform, "there's a reason central banks are independent, and here's what happens when one overcomes the boredom." A perfect monetary storm. " According to him, "drastic measures must be taken to change things now", because otherwise "they will get worse and the pressure will become unbearable".
"As long as I am in this position, I will continue to fight against high interest rates," the head of state said in a speech to the Turkish parliament last week, citing a ban on usury in the Koran.
Since 2019, Recep Tayyip Erdogan has ousted three central bankers who had differing views on matters, further undermining market confidence.
"We are sinking"
Many Turks admit that they can not stop watching the exchange rate and constantly make calculations for their expenses - calculations that "change a hundred times a day."
On social networking sites, the tags that prevail among users in Turkey are quite indicative of the climate: "We are sinking", "Government resign", "We can not cope".
In the city of Diyarbakir, traders burned fake dollars on the street. "We can not turn a blind eye, we do not know what our future is," said one.
Many employees or retirees say that as soon as they receive their salary or pension, they immediately convert the amount into foreign currency. Emirhan Metin, a 28-year-old lawyer, explains that he does it "because it makes sense" every calculation. "It is almost impossible to concentrate or talk about anything other than the financial crisis," he added.
