Central Bank: Turkish lira starts becoming expensive

Photo: Central Bank: Turkish lira starts becoming expensive
 / Turkey

Baku, Azerbaijan, Feb. 6

By Rufiz Hafizoglu - Trend:

Following the Turkish Central Bank's efforts to stop further depreciation of the lira, the exchange rate of the dollar in the country dropped by 1.17 percent - to 2.2393 liras per one U.S. dollar, according to a message from the bank.

The bank raised three key interest rates on January 28 [the day before the official exchange rate reached a record high - 2.3142 liras] in order to stop further depreciation of the national currency.

At the same time the weekly repo rate was increased from 4.5 to 10 percent.

Aside from that the Turkish Central Bank raised its lending rate from 7.75 percent to 12 percent, and the rate on deposits - from 3.5 to eight percent.

Earlier the Central Bank of Turkey intervened on $2 billion to keep the Turkish lira exchange rate stable, but this attempt was unsuccessful.

Commenting on rise of the dollar's exchange rate, Turkish Deputy Prime Minister for Economic and Financial Affairs, Ali Babacan said the rise in price of the U.S. currency in the country is a temporary phenomenon.

He also noted that the growth of the dollar is being observed not only in Turkey but also in Russia and Latin American countries.

The deputy prime minister stressed that the depreciation of the national currency will not affect the country's economy.

Translated by E.A.

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