The crisis facing the Turkish economy led to the issuance of a presidential decree published in the official gazette yesterday announcing the isolation of the central bank governor Murad Gintinkaya and the appointment of his deputy Murad Oisal instead. The dispute between the government and the bank over monetary policies in the face of the economic slowdown, Currency volatility, high inflation, and a reluctance to cut interest rates.
The central bank has been under pressure from Turkish President Recep Tayyip Erdogan to cut interest rates to revive an economy that has slipped into recession and shrank sharply for the second consecutive quarter in early 2019. The currency crisis, high inflation and interest rates Total production significantly.
Gitenga raised interest rates by 750 basis points in total, last year, to support the weak pound, bringing interest rates to 24% by September, and has been set at this level so far.
Erdogan's brother-in-law, Bareket al-Bayrak, a finance minister and treasurer, has repeatedly criticized the central bank for keeping interest rates high. "The president and finance minister asked Gittinkaya to resign but he reminded them of the bank's independence and refused to resign," another source said.
In a statement yesterday, the central bank said it would continue to operate independently and that the new governor would focus on maintaining price stability as a key objective.
Erdogan's Justice and Development Party (AKP) built its success on Turkey's strong growth and its supporters boasted a high standard of living during the 16 years of their leader's rule, first as prime minister and then as president, but the economy's slide contributed to the party's loss of local elections in Istanbul and Ankara. Which has been in power since 2002.