Coming into Friday, the Turkish lira was having a rough week.
The currency, which collapsed earlier this month after the imposition of U.S. sanctions exacerbated an already bad situation characterized by an autocratic executive who calls interest rates the "mother of all evil" and who has made good on his promise to commandeer monetary policy, was the second worst performer behind the Argentine peso coming into Friday.
Since August 13, when USDTRY was quoted as high as 7.23 following a weekend during which Recep Tayyip Erdogan dug in his heels and flatly rejected calls for rate hikes and ruled out an IMF program, Turkey's central bank has taken a series of steps to try and stanch the bleeding. Again, they are severely hamstrung in this effort by Erdogan, who will not countenance draconian hikes to the policy rate. Instead, CBT has resorted to half-measures (e.g., swaps crackdowns) and stealth hikes.
Those efforts have met with some limited success, but with the lira down sharply on the week, they tried something else on Friday. Specifically, they're going to raises taxes on dollar deposits and cut taxes on lira deposit accounts. Here are the specifics, for anyone who's not inte
Please support this website by adding us to your whitelist in your ad blocker. Ads are what helps us bring you premium content! Thank you!