Close

Erdoğan defends Central Bank’s recent cut, calls for more

DAILY SABAH
ISTANBUL
Published
Turkish President Recep Tayyip Erdogan (L) speaks during an interview with Bloomberg News editor-in-chief John Micklethwait (R) in New York, United States on September 22, 2016. ( AA Photo ) Turkish President Recep Tayyip Erdogan (L) speaks during an interview with Bloomberg News editor-in-chief John Micklethwait (R) in New York, United States on September 22, 2016. ( AA Photo )

President Recep Tayyip Erdoğan has called Turkey's Central Bank's recent decision to cut interest rates as a positive step, saying that policy makers should continue to do so.

Speaking to Bloomberg in New York on Thursday, Erdoğan said that the Central Bank's cut was steady, balanced and careful and it should refrain itself from making sudden up and down moves which could hurt the Turkish economy.

The president said the country's commercial banks should receive the signal and lower their own borrowing costs to make credit available to investors.

The Central Bank's Monetary Policy Committee (MPC) launched a 25-basis point cut in the upper band of interest rates this week following recent reductions in the last six months, in line with expectations. The committee reduced the marginal funding rate to 8.25 percent from 8.5 percent, while keeping the borrowing interest rate stable at 7.25 percent.

"You can only talk about development in a country where there's investment,'' he said. "But when interest rates are high, it's not possible to invest.''

While the currency has recovered most of its losses following the coup attempt, Erdoğan said it is still not at a desirable level, adding that the currency didn't experience an explosion, even after the coup attempt.

"It's not at the desired level. But those who were expecting it to crash, they didn't get the result they wanted,'' he said.

The value of the dollar against the Turkish lira climbed to 3.07 from 2.90, between the coup attempt Friday and the following Monday, but fell back to around its previous level within days.

Meanwhile, Erdoğan attended a roundtable meeting with high-level investors and businessmen organized by Michael Bloomberg, the CEO of Bloomberg in New York.

Erdoğan was accompanied by Minister of EU Affairs Ömer Çelik, Minister of Economy Nihat Zeybekçi, Minister of Energy and Natural Resources Berat Albayrak, Deputy Chairman of the Justice and Development Party (AK Party) Yasin Aktay, AK Party Parliamentary Group Deputy Chairman Mustafa Elitaş, Turkey's Ambassador to Washington, DC Serdar Kılıç Deputy Secretary General and Spokesperson of the Presidency İbrahim Kalın.

The American guests invited by Bloomber were Citi's Chief Executive Officer for Europe, Middle East & Africa James C. Cowles, ‎Partner at Caxton Associates Jeff Enslin, CEO of Lazard Ken Jacobs, President of Blackstone Hamilton E. Jones, CEO of Warburg Pincus Chip Kaye, Henry Kissinger of Kissinger Associates, Executive Board Director of BBVA Jose Manuel Gonzalez-Paramo, President of WL Ross and Co. Wilbur Ross, Representative of the Secretary-General for the Investments of the Fund Carol Boykin, chess grandmaster Magnus Carlsen and his manager Espen Agdestein, James Rothschild of the Rothschild Family.

Share on Facebook Share on Twitter
DAILY SABAH RECOMMENDS