A series of measures were announced on Sunday, June 25 by the new head of Turkiye’s central bank, former Goldman Sachs executive Hafize Gaye Erkan, which he described as the “first step” in moving towards a more “simplified” approach to policy making. They included raising interest rates by 650 basis points up to 15%, and stopping the use of foreign reserves to defend the value of the Turkish lira, which as a result has been devalued by 28% so far this year.
Recall that Goldman Sachs was predicting/proposing that the lira would drop by about 33% this year. This is part of the City of London and Wall Street’s generalized assault on rebellious Global South countries, in the lead up to the Aug. 22-24 BRICS summit in South Africa.
Another measure announced by central banker Erkan and the new Finance Minister, Mehmet Şimşek, a former senior Merrill Lynch bond strategist who like Erkan was appointed by President Recep Tayyip Erdoğan this month after the leader’s re-election in May, was to loosen bank regulations designed to push consumers and businesses to reduce dollar holdings.
