President Tayyip Erdogan called on Friday for the Turkish Central Bank to cut interest rates, saying he may summon central bank officials to discuss the issue if necessary, exerting pressure on the bank before its policy meeting next week. Turkey faces a parliamentary election in June and Erdogan, a staunch critic of central bank policy, said investment will not reach the government's desired level if interest rates remain high.
"Our central bank is standing still while everyone in the world is lowering interest rates. What are you waiting for?" Erdogan said in a speech in Ankara. "If necessary I will summon them and discuss this. It can't go on like this," he added. The central bank will hold its monthly monetary policy committee meeting on Tuesday with some economists expecting it to cut rates.
Last month, the bank kept rates on hold, leaving its one-week repo rate at 8.25 percent despite a recent fall in inflation expectations, and said it would keep policy tight until there is a clear improvement in the outlook for prices. The lira eased to 2.3210 against the dollar after Erdogan's comments from 2.3140 beforehand. Bonds were little changed while the main share index was 0.26 percent lower.