As­sets fall as in­fla­tion puts Is­tan­bul’s pol­icy in the spot­light

Irish Independent - Business Week - - FRONT PAGE -

THE Turk­ish lira fell and govern­ment bonds dropped amid con­cern that the coun­try’s author­i­ties were not do­ing enough to tackle run­away prices.

The cur­rency slumped al­most 2pc against the dol­lar and the yield on 10-year govern­ment bonds jumped more than 100 ba­sis points af­ter in­fla­tion ac­cel­er­ated to 24.5pc in Septem­ber.

While the lira has shown signs of sta­bil­is­ing af­ter the cen­tral bank raised in­ter­est rates to 24pc last month, help­ing govern­ment bonds rally, many an­a­lysts crit­i­cized pol­icy mak­ers for wait­ing too long to act. The knock-on ef­fects of a more than 35pc de­pre­ci­a­tion in the lira this year are still feed­ing through into higher con­sumer prices, fu­elling calls for even higher bor­row­ing costs.


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