Baku, Azerbaijan, March 12
By Rufiz Hafizoglu - Trend:
Turkey is ready for any development of the economic situation both in the country and in the world, Turkish Deputy Prime Minister for Economic Affairs Ali Babacan was quoted March 12 by Anadolu agency as saying.
As one of the examples of changing the economic situation, Babacan cited an increase in the dollar exchange rate in a number of European and other countries.
Turkey's President Recep Tayyip Erdogan has recently met with the Head of the Central Bank Erdem Basci and Deputy Prime Minister Ali Babacan. They discussed the economic situation in Turkey.
The meeting lasted for 2.5 hours at the presidential palace. Basci made a report consisting of 130 pages.
Earlier, Basci several times asked for a meeting with the president, but Erdogan declined to meet.
On Feb. 10, Erdogan criticized Basci's work, saying his policy harms the country's interests.
Turkey's central bank on Jan. 20 lowered its key interest rate (the weekly repo rate) by 0.5 percentage points to 7.75 percent, while the other two rates, that is, one on deposits and the other one on overnight loans were left at 7.5 and 11.25 percent respectively.
Turkish media earlier reported that a prosecutor of a court in Ankara, Serif Aydin, filed a lawsuit against Basci. The prosecutor accused Basci of serious material damage inflicted to Turkey's citizens as a result of an erroneous interest rate policy of the central bank.
The prosecutor said that, in case of a trial, the Turkish central bank's head could be imprisoned for up to two years. Meanwhile Ali Babacan had said that the central bank pursues the right monetary policy.
Basci had said the central bank in 2015 expects the minimum level of inflation in Turkey over the past 45 years. He said it is expected that this year the consumer price index in Turkey will stand at 5.2 percent, and in 2016 - at five percent. He said the country's central bank would do everything possible to keep inflation under control.
The inflation rate in Turkey was 8.31 percent in 2014. To keep the exchange rate of Turkish lira at a stable level, Turkey's central bank carried out intervention worth $2 billion throughout 2014, however this attempt was unsuccessful.
The process of strengthening the lira (by 9.4 percent) in 2014 continued until September of that year. The exchange rate of the national currency started cheapening in the subsequent months.
(The dollar exchange rate in Turkey increased by 7.4 percent by the end of 2014).
The Turkish lira hit record lows against the US dollar on Mar. 6, 2015 reaching 2.6862.
The official exchange rate is 2.6238 TRY/USD on March 12.
Edited by CN
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