Turkish President Tayyip Erdogan on Saturday urged businessmen not to try to profit from the strong dollar, a day after the lira hit a record low against the US currency. The Turkish lira hit a record low of 2.6470 on Friday, following a week of losses, partly as a result of the dollar's strength but also due to Erdogan's harsh criticism of the country's central bank, prompting fears of political meddling in monetary policy.
"I am addressing civil society groups and businessmen: Do not dare to make a quick buck by buying dollars. You would hit a brick wall," Erdogan said in the south-eastern province of Gaziantep, a stronghold for the ruling AK Party. Facing flagging growth and with June elections looming, Erdogan has criticised the bank for not cutting interest rates sharply enough and said anyone who defends high rates is guilty of "treason".
He also evoked memories of 2001 economic crisis, when Turkish lira depreciated sharply against the dollar and the interest rates shot up following a political crisis between the prime minister and president at the time. "This country became poor overnight because of a ... crisis," Erdogan said, referring to the country's economic troubles in 2001. "And some people pocketed $40 million dollars." Prime Minister Ahmet Davutoglu and other members of the economic team have been meeting fund managers and bankers in New York over the past few days, in an attempt to allay concern about Erdogan's battle with the central bank.
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