The Turkish president has dismissed one of the vice presidents of the country’s central bank. This is the third senior official to be dismissed within two months in a series of interventions at a nominally independent institution that has disturbed investors.
Early Tuesday, Legep Typ Erdogan announced a decree in the official bulletin to dismiss Ogzan Osbas, a member of the Monetary Policy Committee, and replace him with Semi-Tumen, a professor of economics at TED University in Ankara.
In March, Prime Minister Erdogan fired Nadiabal, the third central bank governor, in less than two years. Agbal has been replaced by newspaper columnist Sahap Cavsiogur, who shares Erdogan’s unconventional view that high interest rates drive inflation rather than quell it. A week later, Prime Minister Erdogan replaced Deputy Governor Murat Cetinkaya.
Lira is worried that banks under the Cabsioglu administration may not be able to tighten monetary policy against Prime Minister Erdogan to combat inflation, which has remained at double-digit levels for the past three years. It has lost 14% of its value against the dollar since March. ..
Erdogan said both interest rates and inflation will fall below 10 percent this year. He has long badged central banks to curb borrowing rates to stimulate the economy.
The central bank will hold the next interest rate setting meeting on June 17th. Kabushioguru promised to keep the policy tight until inflation slowed, but removed some of its predecessor hawkish words from the policy statement.
44-year-old Tumen is a graduate of the London School of Economics and the University of Chicago. He previously played various roles at the Central Bank and was Erdogan’s Human Resources Advisor.
Only three of the seven members of the Monetary Policy Committee have been policy makers for more than three years, and the rest have been appointed since early 2020.
Erdogan dismisses Deputy Governor of Turkish Central Bank
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