Turkish lira tumbles to record low as Erdogan pushes for rate cut

The Turkish lira hit its lowest ever level against the U.S. dollar on Wednesday after President Recep Tayyip Erdogan said he had asked the country’s central bank to cut interest rates. The comments were reportedly made in an interview he gave state broadcaster TRT Haber late Tuesday. Erdogan said interest rates needed to start coming down in July and August. The dollar rose to a record high of 8.6862 lira from 8.5369 on Tuesday. “Turkey’s inflation problem has escalated in recent months with the annual CPI rate exceeding 17% in April, so maintaining high interest rates is infinitely important. As long as the central bank’s hands are tied by politics, it’s difficult to see the bottom in the lira’s multi-decade downtrend,” said Marios Hadjikyriacos, investment analyst at XM, in a note to clients. Erdogan, who has made frequent calls for easier borrowing rates, has also fired several central bank officials over the years.

Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.