Turkish president fires central bank governor as lira falls
ERBIL, Kurdistan Region – Turkish President Recep Tayyip Erdogan sacked the governor of the central bank early Saturday as the lira continues to slide, replacing him with a former finance minister days before an important meeting of the bank, according to a decree published by the Official Gazette.
The decree does not provide any reason why Murat Uysal was fired. He was only in office for some 16 months, brought in to replace Murat Cetinkaya who had refused to accept Erdogan’s demand to cut interest rates.
Erdogan appointed Naci Agbal, former head of the strategy and budget directorate in his office, as the new bank governor. Agbal, 52, was finance minister from 2015 to 2018 when he vacated his post for Erdogan’s son-in-law, Berat Albayrak.
The decision comes as the Turkish lira is losing value against foreign currencies, especially the US dollar. This week it slid to 8.54 against the dollar and over 10 against the euro. The central bank is under pressure to increase interest rates, but kept it steady at 10.25% on October 22, triggering a drop in the value of the lira.
The bank is expected to hold its next monetary policy meeting on November 19 and the dismissed governor hinted in late October that he may increase interest rates at that meeting.
Erdogan has said multiple times that he wants interest rates low. He said last week that he has been waging an economic war against people squeezing Turkey in “the devil’s triangle of interest and exchange rates and inflation.”
Finance Minister Albayrak has reportedly blamed the slide in the lira on the spread of coronavirus and the uncertainty around who would become the next US President. He also warned against higher interest rates.
The decree does not provide any reason why Murat Uysal was fired. He was only in office for some 16 months, brought in to replace Murat Cetinkaya who had refused to accept Erdogan’s demand to cut interest rates.
Erdogan appointed Naci Agbal, former head of the strategy and budget directorate in his office, as the new bank governor. Agbal, 52, was finance minister from 2015 to 2018 when he vacated his post for Erdogan’s son-in-law, Berat Albayrak.
The decision comes as the Turkish lira is losing value against foreign currencies, especially the US dollar. This week it slid to 8.54 against the dollar and over 10 against the euro. The central bank is under pressure to increase interest rates, but kept it steady at 10.25% on October 22, triggering a drop in the value of the lira.
The bank is expected to hold its next monetary policy meeting on November 19 and the dismissed governor hinted in late October that he may increase interest rates at that meeting.
Erdogan has said multiple times that he wants interest rates low. He said last week that he has been waging an economic war against people squeezing Turkey in “the devil’s triangle of interest and exchange rates and inflation.”
Finance Minister Albayrak has reportedly blamed the slide in the lira on the spread of coronavirus and the uncertainty around who would become the next US President. He also warned against higher interest rates.