The value of the Turkish lira collapsed following the re-election of Turkish President Recep Tayyip Erdogan and is – against the dollar – at its lowest point in history. Reuters reports. With Erdogan’s re-election, Turkey is preparing for a third decade of increasingly authoritarian politics.
The lira settled at 20,065 against the dollar on European markets this morning, breaking last Friday’s all-time low. The lira has fluctuated around 7% since the beginning of 2023, losing more than 90% of its value over the last decade. More so now that inflation is running rampant.
Currency crisis
Since the 2021 currency crisis, Turkish authorities have attempted to play an active role in exchange rates. The daily movements, however, have become very small, showing a weakening. “Erdogan’s victory puts further pressure on the Turkish lira,” said Benjamin Picton, senior macro strategist at Rabobank.
Whether Erdogan won is highly dubious from an economic point of view. It is thanks to Erdogan’s monetary policy that the financial situation in Turkey has become so bad. The opposition supported the economic recovery.
Source: BNR
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