Turkish lira strengthens against dollar, euro upon news of Central Bank meeting

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The value of the lira responded by rising to around 4.58 per dollar, after it had dropped to over 4.80 per dollar, down about 5 percent since the previous day.

The lira's recent decline accelerated this week, after comments from Turkish President Recep Tayyip Erdogan, echoing statements he has made previously, that interest rates should be lower and that he would take a proactive role in influencing central bank policy.

But doing so will make borrowing more expensive and likely have a negative effect on economic growth.

Dragging on the Turkey market outlook, the lira currency has tumbled to record lows in recent weeks and weakened by more than 20% against the Dollars so far this year and depreciated 70% over the past five years. The risk is that will increase the price of imports, making Turkish people effectively poorer.

Turkey's sole stock exchange group said the decision was taken while considering that among financial tables of all sectors and companies, there is no economic data that shows a necessity for such high levels of foreign exchange rates. "The volatility in the exchange rate is not just about our country; it's a global problem". The current account is the broadest measure of trade, covering not only the movement of goods and services but also investment flows.

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Despite posting an impressive 7.4-percent growth in 2017, the highest in G20 member countries, Turkey's economy has started showing signs of overheating, according to specialists. Economists say that is partly because the U.S. Federal Reserve is raising interest rates, encouraging investors to place their money in the U.S. instead of other economies.

Because Turkey is particularly dependent on foreign capital, its markets are among those to have suffered most.

Turkey's central bank raised its late liquidity window rate by 300 basis points to 16.5 percent on Wednesday, it said in a statement on its website after an emergency meeting of its monetary policy committee. "The Central Bank will continue to use all available instruments in pursuit of the price stability objective".

"Those who believe that by manipulating the dollar they will lead to results that will harm the nation and their pockets and change the election result, are mistaken", the state-run Anadolu Agency quoted Bozdag as saying.

He hurt the lira last week by saying he plans a greater say in monetary policy if he wins the elections, which markets saw as a slap in the face of the nominally independent central bank.

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