8chan/8kun QResearch Posts (4)
#7045941 at 2019-07-15 05:02:21 (UTC+1)
Q Research General #9015: [Smollett] Federal charges coming? Edition
Turkey's Erdogan Vows To "Significantly" Cut Rates As Trump Set To Roll Out Sanctions Over S-400 Purchase
Lately not a week passes without some dismal news involving Turkey hitting the tape, and yet the lira continues to levitate, blissfully ignorant of the storm clouds headed for Ankara, levitating on hopes the Fed will cut rates and sprinkle golden showers on emerging markets. However, in light of the two latest developments, the Mrs Watanabe sellers of USDTRY may finally pay attention.
On Sunday, Turkish President Recep Tayyip Erdogan - who last weekend fired the head of the central bank for not cutting rates fast enough, and who has now become the de facto head of the CBRT - promised "significantly lower interest rates by the end of the year", Bloomberg reported.
"We aim to reduce inflation to one digit by the end of this year," Erdogan told journalists in Istanbul, according to the state-run Anadolu news agency. "As we achieve this, we will achieve our year-end interest rate target as well." Of course, should interest rates drop to one digit, the USDTRY will promptly collapse to two, as the rate differential between the lira and the dollar collapses, removing the main incentive to go long the lira at a time when the Turkish economy remains in crisis.
Having founded the economic school of Erdoganomics, according to which inflation can be achieved only by lowering rates, the Turkish president and his US counterpart have quickly become kindered spirits when it comes to monetary policy. And just as Trump heaps pressure and insults on Fed Chair Powell, Erdogan has frequently accused the central bank of keeping borrowing costs too high. Last month, he complained that while the Fed was moving toward a rate cut, Turkey's policy rate of 24% "is unacceptable."
Then, the last trace of any pretense that Turkey under Erdogan will forever be a banana republic came on July 6, when Erdogan unexpectedly dismissed the former central bank head, Murat Cetinkaya and made it clear that he expects his replacement as central bank governor to follow the government's line on monetary policy. Cetinkaya had held rates steady for more than nine months.
Meanwhile, even as Trump and Erdo may be BFFs when it comes to firing head of central banks, the US president and his advisors have reportedly settled on a sanctions package to punish Turkey for receiving parts of a Russian S-400 missile defense system and plans to announce it in the coming days, Bloomberg wrote in a separate report.
News of the imminent sanctions was somewhat unexpectedly considering that when Trump and Erdogan met at the G-20 summit in Japan in June, the U.S. president suggested possible leniency on sanctions. He sought to blame the Obama administration for Turkey's decision to buy the Russian equipment, saying the impasse is "not really Erdogan's fault."
According to Bloomberg, the administration "chose one of three sets of actions devised to inflict varying degrees of pain under the Countering America's Adversaries Through Sanctions Act, the people said, without identifying which set had been chosen. The plan needs Trump's approval."
Trump is said to unveil the sanctions late next week, and - in an unexpected act of courtesy to Ankara - intends to wait until after Monday's anniversary of a 2016 coup attempt against Turkey's President Recep Tayyip Erdogan to avoid fueling further speculation that the U.S. was responsible for the uprising. And while we don't know the details of the prepared sanctions, we know the following:
The plan was developed after days of discussions between officials at the State and Defense departments and the National Security Council. It awaits a sign-off by Trump and his top advisers, the people said, requesting anonymity to discuss a sensitive matter. A State Department spokeswoman declined to comment.
While not nearly as bad as that with other non-Saudi middle-eastern nations, the relationship between the U.S. and Turkey has deteriorated over the course of the civil war in Syria, where U.S. backing for Kurdish militants frustrated Turkey, which considers the group an extension of the separatists it's fighting at home. Erdogan has also criticized the US for not extraditing Gulen, whom he accuses of masterminding the fake attempted "coup" the served as the launchpad for Erdogan's transformation to an "executive president" last year, read quasi dictator.
Acting U.S. Defense Secretary Mark Esper said Friday that Washington's position that Turkey can't have both the F-35 and the Russian missile system "has not changed." Esper spoke with Defense Minister Hulusi Akar in the afternoon, and the Turkish government said in a statement that a U.S. delegation would visit next week to keep discussing the issue.
https://www.zerohedge.com/news/2019-07-14/turkeys-erdogan-vows-significantly-cut-rates-trump-set-roll-out-sanctions-over-s
#6943822 at 2019-07-07 20:50:36 (UTC+1)
Q Research General #8883:FIJI, WATCH THE WATER! Edition
Lira Crashes After Erdogan Unexpectedly Fires Turkey's Central Bank Governor
Just as glimmers of hope were starting to emerge that Turkey may finally crawl its way out of the deep hole it dug for itself last summer… and Erdogan happens.
The Turkish Lira has opened in early trading, crashing over 16 handles…
So what will Erdogan do to support the Lira this time? Ziad Daoud, Bloomberg's Mideast economist pointed out:
"If Erdogan's aim was to get lower interest rates, then the decision to replace the governor could backfire. Now there's an additional credibility constraint, with financial markets certain to scrutinize the motivation and magnitude of any easing."
* * *
As we detailed yesterday, the world sure can be an ironic place: just one week after the Bank of International Settlements highlighted Turkey as the case study of all the bad things and political costs resulting from political meddling and intervention in a central bank's affairs, when BIS General Manager Agustin Carstens said "you see the government undermining the autonomy of the central bank and at the same time you see the negative consequences," adding that looking at Turkey, other countries can "see what happens when the government tinkers with the autonomy", Turkey's president Erdogan had just one message: "hold my bear."
That's right: two weeks after Erdogan appeared to finally throw in the towel on aggressively authoritarian practices when he conceded the loss of the Istanbul election revote to his ruling party's primary challenger in a surprisingly subdued response, the "executive president" reminded everyone just why Turkey remains a consummate economic basket case, when on Saturday morning, Erdogan unexpectedly fired Murat Cetinkaya as central bank governor, after he reportedly refused an informal request to resign, according to Bloomberg which also correctly notes that the decision to terminate the centrist central banker risks a furious market backlash just as foreign money started returning to Turkey, which was expected to start interest-rate cuts in the immediate future.
https://www.zerohedge.com/news/2019-07-06/shocking-move-erdogan-unexpectedly-fires-turkeys-central-bank-governor
#6930055 at 2019-07-06 04:48:54 (UTC+1)
Q Research General #8865: Moar Cali EQ Swarms! Edition
Erdogan Removes Cetinkaya, Names Deputy as Central Bank Governor
Turkish President Recep Tayyip Erdogan unexpectedly removed Murat Cetinkaya as central bank governor and replaced him with his deputy, Murat Uysal, according to the Official Gazette.
Cetinkaya, appointed governor in April 2016, was criticized for acting too slowly to tighten monetary policy during a currency rout in August. But he increased the benchmark interest rate by 625 points in September and has kept it at that level ever since.
Erdogan frequently chastised the central bank for keeping rates elevated. While the U.S. Federal Reserve is moving closer to lowering interest rates, "the policy rate in my country is 24%, this is unacceptable," Erdogan said last month.
Uysal, deputy governor since June 9, 2016, said he would continue to implement monetary-policy tools independently, in line with his mandate and authority. Uysal will hold a press conference in the upcoming days, according to a statement on the central bank's website.
https://www.bloomberg.com//news/articles/2019-07-06/erdogan-removes-Cetinkaya-names-deputy-as-central-bank-governor?srnd=markets-vp
#6929103 at 2019-07-06 02:50:30 (UTC+1)
Q Research General #8864: Moar FBI vault drop convos! Edition
Turkey Appoints New Central Bank Governor - Report
Turkish authorities are reportedly reviving plans to transfer the central bank's 46 billion lira ($8 billion) in legal reserves to country's budget to boost the economy and are also considering adjusting some tax measures as it battles recession, Reuters reported, citing sources.
According to the Turkish presidential decree, cited by Reuters, Ankara removed its central bank governor Murat Cetinkaya early on Saturday and replaced him with the bank's deputy governor Murat Uysal.
There have been no reports on the reason regarding the replacement.
In 2018, the Turkish economy struggled due to the depreciation of the national currency, lira, which fell by nearly 40 percent against the US dollar when the relations between Ankara and Washington deteriorated. The situation significantly worsened in August, when US President Donald Trump authorized the doubling of tariffs on steel and aluminum imports from Turkey up to 50 and 20 percent respectively. However, by the years end the Turkish currency has reportedly managed to recover.
However, Turkey's budget deficit skyrocketed up to 225 percent in the first five months of the current year, according to Reuters. The Turkish Treasury and Finance ministry has reportedly drafted measures to prevent further deterioration in the domestic economy.
In particular, the measures Reportedly included raising taxes on high-income individuals, lowering corporate taxes, and transferring the central bank's 46 billion lira ($8 billion) in legal reserves to the budget.
According to Reuters, planned measures were postponed until October 2019.
https://sputniknews.com/middleeast/201907061076164881-turkey-appoints-new-central-bank-governor—report/
8kun Midnight Riders Posts (1)
#72003 at 2021-03-20 20:39:15 (UTC+1)
QR Midnight Riders #322: Honoring Planefag Dedication Edition
Erdogan sacks another central bank chief after sharp rate hike
President Tayyip Erdogan abruptly sacked Turkey's central bank chief on Saturday, two days after a sharp interest rate hike to head off inflation, replacing him with a former ruling party lawmaker and critic of tight monetary policy.
It was the third time since mid-2019 that Erdogan - who has repeatedly called for low rates - has ousted a bank governor. Analysts predicted the lira would tumble when markets reopened as the bank's credibility took another hit. Outgoing governor Naci Agbal, appointed less than five months ago, had won market praise by aggressively raising the policy rate by 875 basis points to 19%, the highest of any big economy. His shock removal, announced in the early hours Saturday, comes after the bank hiked rates by a more-than-expected 200 points on Thursday in a "front-loaded" move meant to head off inflation near 16% and a dipping lira. The country's Official Gazette announced that Erdogan had replaced him with Sahap Kavcioglu, a former member of parliament for Erdogan's ruling AK Party (AKP). The former banker has publicly criticised Agbal's hawkish policy. "While interest rates are close to zero in the world, opting for a rate hike for us will not solve economic problems," he wrote in a column in Yeni Safak newspaper last month.
Rate hikes will "indirectly cause inflation to rise," he added - echoing Erdogan's unorthodox view of monetary economics, which has dogged the major emerging market economy for years. A lack of monetary independence has exacerbated Turkey's boom-bust growth and record dollarization, and helped keep inflation in double digits for most of the last four years, economists say. The lira has lost half its value since 2018. "This implies the government will once again try to stimulate the economy by low rate policies," said Selva Demiralp, director of the Koc University-TUSIAD Economic Research Forum, in Istanbul. "Such a priority has a high potential to backfire by causing extreme pressures on the lira and contracting the economy even further," she said. Kavcioglu, the fourth central bank chief in five years, is known among local bankers but little among mainstream economists and foreign investors.
Before being elected in 2015 in Turkey's northeast AKP stronghold, he was deputy general manager at state lender Halkbank as part of a more than 25-year career in banking. A trader at one local bank predicted Kavcioglu would deliver a rate cut before the next scheduled policy meeting in April. "There is now a very real chance that Turkey is heading for a messy balance of payments crisis," Jason Tuvey, analyst at Capital Economics, wrote in a note. Since Agbal's appointment on Nov. 7, the lira had rebounded more than 15% from a record low beyond 8.50 to the dollar. Some $20 billion of foreign funds also trickled into Turkish assets, reversing years of outflows. But even tough Erdogan appointed Agbal as part of what he called a new market-friendly economic era, the president continued to urge lower rates. In announcing reforms this month, he said price stability should be "put aside".
Early on Saturday, Agbal thanked Erdogan on Twitter "for all the posts he has found me fit for and appointed me to until today… I also convey my gratefulness for removing me from my post as of today." Agbal, also a long-time AKP member, had regularly repeated his determination to get inflation down to a 5% target by the end of 2023 and promised to hike again if needed. "If you abandon a tight policy stance … at an early stage, past experiences show that inflation moves upward again," Agbal told Reuters last month in his first interview as governor. His removal continues the rapid turnover at the bank. In July 2019, Erdogan sacked governor Murat Cetinkaya for not bringing interest rates down swiftly. He dismissed Cetinkaya's replacement, Murat Uysal, in November last year after the lira slumped to its record low.
https://asia.nikkei.com/Economy/Erdogan-sacks-another-central-bank-chief-after-sharp-rate-hike
8chan/8kun QRB Posts (1)
#56621 at 2021-05-25 14:36:44 (UTC+1)
QRB General #226: Tuesday Morning Melania Edition
Erdogan fires deputy governor of Turkey's central bank
Turkey's president has fired one of the deputy governors at the country's central bank, the third senior official to be dismissed in two months in a series of interventions at the nominally independent institution that has unnerved investors.
Recep Tayyip Erdogan issued a decree in the Official Gazette in the early hours of Tuesday dismissing Oguzhan Ozbas, a member of the monetary policy committee (MPC), and replacing him with Semih Tumen, a presidential adviser and a professor of economics at TED University in Ankara.
In March, Erdogan fired Naci Agbal, the third central bank governor in less than two years. The market-friendly Agbal was replaced by Sahap Kavcioglu, a newspaper columnist who shares Erdogan's unconventional view that high interest rates drive, rather than quell, inflation. A week later, Erdogan replaced deputy governor Murat Cetinkaya. The lira has lost 14 per cent of its value against the dollar since March amid fears the bank under Kavcioglu would not defy Erdogan and keep monetary policy tight to fight inflation, which has been stuck in double digits for much of the past three years. The lira on Tuesday was little changed in a sign that investors have become inured to Erdogan's meddling at the bank. "Independence at the Turkish central bank is already basically nonexistent and the president has taken control of monetary policy, with the help of the new central bank governor," said Jason Tuvey, senior emerging markets economist at Capital Economics.
Erdogan has said both interest rates and inflation will be below 10 per cent this year. He has long badgered the central bank to suppress borrowing rates to stimulate the economy. The newest MPC member has graduate degrees from the London School of Economics and the University of Chicago. Tumen, 44, worked in various positions at the central bank between 2002 and 2018 before teaching labour economics and advising Erdogan on human resources. "The latest change ... is another step in an expected sequence towards nominating an entire MPC of low-interest rate advocates," Tatha Ghose, an emerging markets analyst at Commerzbank, said in a note to clients.
Just three of the seven committee members have served as policymakers for three or more years, with the rest appointed since 2020.
https://asia.nikkei.com/Politics/Erdogan-fires-deputy-governor-of-Turkey-s-central-bank