Turkish Lira Drops Again After Erdogan’s Manipulation Probe

The Turkish lira again slid by as much as 4.6 percent against the dollar on Monday after President Recep Tayyip Erdoğan ordered an investigation on a possible manipulation of the currency.

The lira had already lost 45 percent of its value this year — having hit a record-low 13.45 last Tuesday — following various rate cuts ordered by Erdogan. The president has repeatedly defended his unorthodox policy stance amid criticisms.

“The submissiveness of those who see high interest rates, inflation and the foreign exchange traps as our country’s fate is called learned helplessness,” Erdogan said in a speech last week, defending his preference for low interest rates.

“We have overcome this learned helplessness syndrome and elevated our country to the highest league in many areas extending from defense industry to healthcare, and we will achieve the same in economic policies as well,” Erdogan added.

State-run Anadolu reported on Saturday that Erdogan had tasked the State Supervisory Council, an auditing agency, to investigate institutions that bring large amounts of foreign currency and to determine whether any manipulation has caused the lira slump.

Turkey’s central bank has slashed 400 basis points since September to 15 percent, under pressure from Erdogan. Authorities have been signaling another possible cut in December, which analysts expect will drive the country’s inflation over 20 percent.

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