Turkey’s troubled currency the lira nosedived Monday after President Recep Tayyip Erdogan cited Muslim teachings to justify not raising interest rates to stabilise the currency.

Erdogan has pushed the central bank to sharply lower borrowing costs despite the annual rate of inflation soaring to more than 20 percent.

Economists believe the policy could see consumer price increases reach 30 percent or higher in the coming months.

But Erdogan said in remarks aired by state television late Sunday that his Muslim faith prevented him from supporting rate hikes.

“They complain we keep decreasing the interest rate. Don’t expect anything else from me,” he said in the televised comments.

“As a Muslim, I will continue doing what our religion tells us. This is the command.”

Islamic teachings forbid Muslims from receiving or charging interest on loaned or borrowed money.

Erdogan has previously cited his religion in explaining why he believes interest rates cause inflation instead of reining it in.

High-interest rates are a drag on activity and slow down economic growth.

But central banks raise their policy rates out of necessity when inflation gets out of hand.

The Turkish lira has now lost nearly half its value in the past three months alone.

It was trading down more six percent against the dollar on Monday afternoon.

A dollar could buy 7.4 liras on January 1. It was worth 17.5 liras on Monday.

“You cannot run a modern economy integrated into the global economy on this basis,” economist Timothy Ash of BlueBay Asset Management said in a note to clients.

https://guardian.ng/news/lira-plunges-again-after-erdogan-cites-islam-to-defend-rate-cuts/?utm_medium=Social&echobox=twitter_post&utm_source=Twitter#Echobox=1639997714-1

This is a good time to go and import mote POP materials and.make a good profit.

This is a good time to go and import more building materials ,.and.make good profit

Useless and bad policy. Erdogan is doing this to salvage his dwindling popularity in turkey by appealing to religious sentiments.

To remember that this country was once the stronghold of Christendom makes me shed tears but thank God for the Advent of the crusaders, who knows even Rome and the entire Italy might have been an Islamic country

clarocuzioo:
This is a good time to go and import mote POP materials and.make a good profit.

your seeing what am seeing in last three days i have been on it

White aboki

Erdogan should go.

He fears a backlash upon stepping down due to the many toes he's stepped on, especially the imprisoned thousands from a very suspect coup plot

The Lira has always been an unstable currency anyway