Breaking News
LAST CHANCE for Cyber Monday SALE: Up to 54% off InvestingPro! Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Turkish central bank dismisses chief economist, department managers: document

EconomyAug 09, 2019 05:34AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: A logo of Turkey's Central Bank is pictured at the entrance of the bank's headquarters in Ankara

By Nevzat Devranoglu

ANKARA (Reuters) - Turkey's central bank has dismissed its chief economist, Hakan Kara, and some department managers, according to a document seen by Reuters, re-igniting concern about political interference in the institution one month after the sacking of its governor.

The decision was part of a reorganization to make the bank more effective, according to the document, and was taken at an internal bank meeting. It followed comments from President Tayyip Erdogan in July that the bank needed to be overhauled.

Also dismissed were the bank's research and monetary policy general manager, Pinar Ozlu; markets general manager Orhan Kandar; and banking and financial institutions general manager Yavuz Yeter, the document showed. Kara and the general managers were all given the role of advisers.

"This move will further weigh on concerns around erosion of (the bank's) institutional strength," said Timothy Ash, head of emerging market research at Blue Bay Asset Management.

Kara was the backbone of the Central Bank of the Republic of Turkey research efforts and "the face of the CBRT for investors for almost two decades", Ash said, adding his dismissal was a greater loss than the sacking of former governor Murat Cetinkaya.

The document did not identify a new chief economist, but named several people as being appointed to fill vacancies in the bank's economics team after the changes. More than 10 people were dismissed in total.

The lira stood at 5.4970 against the dollar at 0830 GMT, weakening from a close on Thursday of 5.4700.

SHARP RATE CUT

The document said the reorganization was carried out to facilitate "the effective performance of duties, the effective management of operations and the clear definition of departments areas of responsibility."

Last September, Governor Cetinkaya raised interest rates by 625 basis points to stem a currency crisis. Rates remained at 24% this year, preventing further losses in Turkey's lira but helping push the economy into recession.

He was sacked last month by Erdogan, who said he failed to follow instructions on interest rates and the bank had not properly fulfilled its role.

Erdogan has often expressed the unorthodox view that inflation will come down when interest rates are lowered, adding that he expects stronger economic recovery in the second half of the year.

At its first meeting under it new governor, Murat Uysal, this month, the bank's monetary policy committee slashed its key interest rate by 425 basis points to 19.75%.

The bank cited improving inflation in its decision to cut rates and said its stance remained cautious. Inflation rose to a 15-year high above 25% last year, prompting the aggressive rate increases, but has dropped to 16.65% as of July.

Erdogan, who has called interest rates the "mother of all evil", has repeatedly called for lower borrowing costs to boost the economy, which shrank 2.6% in the first quarter, after a 30% lira slide last year amid soaring inflation.

He first signaled moves to reorganize the bank in comments to reporters last month, saying Turkey could face serious problems if its central bank were not completely overhauled.

Turkish central bank dismisses chief economist, department managers: document
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email