President Recep Tayyip Erdoğan on Monday said he and his economic administration have been putting in intensive effort for the success of the government's medium-term economic program, emphasizing that all indicators show progress in the right direction.
Erdoğan addressed concerns regarding the economy during a rally in the capital of Ankara, one of the big cities his ruling party seeks to reclaim from the opposition during the local elections later this month.
"Some are once again chasing clandestine games. Those who create doubts about our implemented economic program and predict catastrophes postelection are, as always, aiming for short-term gains. Both the markets and the citizens can rest assured," the president said.
"With our vice president, minister of treasury and finance and other ministers, along with our bureaucrats, we are putting in intensive effort for the success of our economic program."
Installed after Erdoğan's reelection last May, the new economy administration has delivered aggressive tightening aimed at arresting inflation, curbing chronic deficits, rebuilding foreign exchange reserves and stabilizing the Turkish lira.
The Central Bank of the Republic of Türkiye (CBRT) has hiked interest rates by 3,650 basis points since June but paused its tightening cycle last month, saying that the current 45% policy rate is sufficient to bring inflation down.
The bank is expected to leave its benchmark policy rate unchanged for a second straight month this week. However, according to market surveys, most economists forecast another rate hike later this year due to stubborn inflationary pressures.
The CBRT has recently moved to tighten policy, including action on reserve requirements, prompting some banks to either reduce loan limits or even stop offering loans. On Saturday, the bank raised the maximum interest rate on credit card cash withdrawals.
Treasury and Finance Minister Mehmet Şimşek on Sunday promised additional fiscal policy measures, which he said would help inflation to be within the central bank's forecast range in the period ahead.
Annual inflation rose to over 67% in February and is envisaged to peak by the middle of the year before entering what officials say would be a steep downward trend. The central bank sees year-end inflation at as low as 36%.
"If we believe that this will not be the case, we will take additional measures. This is an issue under the central bank's responsibility," Şimşek told an interview with broadcaster Kanal 7.
He added that the central bank had a free hand and would do whatever is necessary to lower inflation.
Erdoğan on Monday pointed out that all indicators, from the national income, employment and exports to public financial balance, show that "we are moving in the right direction."
"We will collectively witness a rapid decline in inflation, our biggest problem, starting from the second half of the year," he noted.
Additionally, Erdoğan expressed optimism for the future, saying, "Hopefully, starting from next year, we will be in a much better position to both compensate for the shortcomings of the past and meet the needs of the future."
Regarding the cost of living triggered by global crises and the additional burden of $104 billion brought by the devastating earthquakes that struck the country's southeastern region more than a year ago, Erdoğan noted that although these factors have not diverted Türkiye's economy from its targets, they have led to undesired consequences.
He acknowledged that "we are aware of the loss of welfare experienced by our workers and small shop owners."