Erdogan asks Turks to prop up currency, buy liras

Erdogan asks Turks to prop up currency, buy liras
The Turkish lira has dropped by 16 percent against the US dollar this month, as imports grow more expensive for citizens.
2 min read
Erdogan during a meeting in Seoul, South Korea [Getty]

Turkish President Recep Tayyip Erdogan called on citizens to exchange their foreign cash to the lira to prop up the country's declining currency.

"My brothers, could those of you who have euros and dollars under their pillows invest their money in liras?" he said in the eastern city of Erzurum.

The lira has lost 16 percent of its value against the US dollar this month after Erdogan said he wanted greater say in monetary policy if he wins legislative and presidential elections scheduled on 24 June. 

This raised concerns about unpredictable economic policy, with IMF chief Christine Lagarde criticising at the time Erdogan's comments and saying central banks should remain independent.  

The lira hit 4.92 against the dollar on Wednesday before rebounding slightly around 4.78. 

Erdogan has repeatedly said the lira's fall was a "conspiracy" by unnamed foreign powers to weaken Turkey.

"If the financial sector plays such games to work against our investors and entrepreneurs, know that you will pay a steep price," Erdogan warned on Saturday.

Under pressure to act, Turkey’s central bank sharply raised its key lending rate on Wednesday to try to stem an outflow of capital from the country, control inflation and support the beleaguered currency.

The lira had lost more than 20 percent of its value against the dollar since the year began.

Concerns have grown that imports would become more expensive for the Turkish people. A lower-valued currency can also lead investors to pull their money out of a country if they expect the value of their investments to drop as the currency weakens.

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