📉 Turkish Lira Reaches New Lowest Value
The Turkish lira keeps dropping, reaching a record low despite the central bank's efforts to control it with higher interest rates.
💹 Monday's Downfall
On Monday, the lira fell below 28 to the US dollar, marking the lowest value ever. It has lost over 50% of its value against the dollar this year.
🏦 Central Bank's Actions
In September, the central bank hiked the main interest rate by 5% to 30% to fight against soaring inflation, making it the fourth consecutive increase.
💼 Regulator's Stance in August
In August, the regulator decided not to put more foreign money to help the lira. They also made banking rules easier which made the lira fall more.
💰 Spending Big to Support Lira
Türkiye used about $200 billion to help the lira in the last 18 months until August, but it also kept interest rates low, using up reserves.
📈 Inflation Keeps Climbing
Last month, the inflation rate went up for the third month in a row to 61.5% from 58.9%. The biggest increase since last December is mainly because of higher taxes and the lira losing value.
📉 Past Low Interest Rate Policy
Before, the government liked having low interest rates even with high inflation. This led to a money crisis in late 2021, making inflation shoot up to over 85% last year. The cost of things for people is expected to go up to around 60% by the end of the year.
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