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The Turkish president has removed a deputy governor of the country’s central bank from office, the third senior official to step down as a result of some interventions in an independent body that has bothered investors in two months.
Recep Tayyip Erdogan issued a decree in the official gazette in the early hours of Tuesday removing Oguzhan Ozbas, a member of the monetary policy committee, and replacing Semih Tumen with a professor of economics at TED University in Ankara.
In March, Erdogan released Naci Agbal, the third central bank governor in less than two years. Instead of Agbal, Sahap Kavcioglu, a newspaper columnist, shares Erdogan’s unusual view, as high interest rates affect inflation rather than calm it down. One week later, Erdogan replaced Deputy Governor Murat Cetinkaya.
The lira has lost 14% of its value against the dollar since March, when Kavcioglu’s subsidiary bank will not be able to challenge Erdogan for a tight monetary policy to combat inflation, which has been stuck in double digits for the past three years. .
Erdogan said interest rates and inflation will be below 10 percent this year. It has long dealt with the central bank to eliminate borrowing rates to stimulate the economy.
The central bank will hold its next rate-setting meeting on June 17. Kavcioglu has pledged to maintain a tight policy until inflation slows, but has removed the wonderful language of the former from policy statements.
Tumen, 44, holds graduate degrees from the London School of Economics and the University of Chicago. He previously worked at the central bank in various roles and as Erdogan’s human resources advisor.
Three out of seven members of the monetary policy committee have served as politicians for three years or more, with the rest appointed from the beginning of 2020.
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