Are an “everlasting” president and his pet government able to raise the exchange rate of the national currency? Some regimes tried to do so, some are attempting to make it right now, and Turkey is about to answer this puzzling question. Recep Erdogan decided not to nickel-and-dime and won both presidential and parliamentary elections. The Supreme Election Council announced Erdogan’s victory even before the official results. Answering all questions, Erdogan said that they had to leave the tension concerning the elections behind adding that the country voted for the growth, development, and investments. On the one hand, it is very useful to have your own parliament and have everything in the country under control. On the other hand, not many people are left to be blamed for problems. In such a situation it is not easy to shift mistakes on someone else if you are the one responsible for everything. It is quite difficult in such a situation to convince everyone that a slump in the national currency is not your fault. Still, some succeed in it.
While Recep Erdogan promises investment development, the Turkish lira is considered one of the worst currencies in the world and the foreign capital is flowing out of the country. Pundits suppose that the monetary course chosen by the President will push the lira even lower despite temporary stability of the exchange rate right after the election.
Devaluation of the lira triggered concerns that the Turkish companies that incurred debts in US dollars and euros may be trying to clear their debts by buying the currency in the domestic market. The country’s central bank made inner crediting more expensive rising interest rates by 500 points since April.
