Turkey Sacks Central Bank Governor
Business
Asharq Al-Awsat
Turkey fired the governor of its central bank and replaced him with economist and former ruling party lawmaker Sahap Kavcioglu, according to a presidential decree published late on Friday. Former finance minister Naci Agbal had only been in the position since November, when he was appointed by President Recep Tayyip Erdogan as part of an overhaul of his economic team. No official reason was given for his sacking, but his dismissal comes after the central bank sharply hiked its main interest rate - by a greater-than-expected 200 basis points on Thursday, from 17 to 19 percent - to curb rising inflation. Erdogan is a strong opponent of high interest rates and once called them the "mother and father of all evil". Erdogan wants to bring the annual inflation rate down to under 10 percent by the end of next year, and to five percent by the time he is next scheduled to face an election in 2023. News of Agbal's replacement came after the markets closed on Friday. The Turkish lira has clawed back roughly 15 percent of its value against the dollar since Erdogan's November reshuffle, which included the resignation of his son-in-law Berat Albayrak as finance minister. Past central bank managers before Agbal have burned through most of Turkey's reserves trying to support the currency while rates remained well below that of inflation. A modest recovery in the lira's value since Agbal's appointment had given the impression he had won Erdogan's blessing to keep the rate high for some time to ward off inflation and help the lira recover. But Erdogan's dislike of high interest rates has remained consistent, with him saying as recently as January that he was "absolutely against" them. The Daily Sabah newspaper said Kavcioglu is an economist who served at high-level positions in several banks, including state lenders Halkbank and Vakifbank.
from Asharq AL-awsat https://english.aawsat.com/home/article/2870581/turkey-sacks-central-bank-governor
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