Turkish lira traded at a record low of 10.97 against the dollar after the country’s central bank trimmed the key rate from 16% to 15% USDTRY is up +4.67%.
- The fall in the lira happens amid rapid inflation that rose by almost 20% in October that is posing a challenge to growth.
- The move by the central bank reflects calls by President Recep Tayyip Erdogan, who has challenged the officials to cut rates to support growth.
- The lira has now shed almost 8% since Monday as investors grew concerned over recent interventions by Erdogan calling for lower rates.
- Investors raise concerns that the rapid inflation and weak currency could make Turkey unable to honor its foreign debts, even as the approval ratings of Erdogan fell 2.5% to 38.9% in October.