Turkish Lira, Bonds Plunge After Erdogan Tells Central Bank "It's On The Wrong Path"

Tyler Durden's picture

Turkish lira plunged near record low 3.9/USD this morning and bond yields spiked over 12.5% for the first time in history as investor anxiety escalated following President Erdogan's attack on the nation's central bank, decrying it's "wrong path."

Currency crisis...

And bond market panic...

As Bloomberg reports, Turkish President Recep Tayyip Erdogan signaled an end to his uneasy truce with the new central bank chief, attacking the institution now run by Governor Murat Cetinkaya for its repeated revisions to economic targets and “wrong path” to tackle soaring inflation.

“They say central banks are independent so we shouldn’t interfere. This is the end result because we haven’t interfered,” Erdogan said in a speech on Friday in Ankara.


“Results speak for themselves.”

“We will solve this, things can’t go on like this,” Erdogan said, vowing to step up a fight against what he calls the “interest rate lobby,” an alleged cabal of financiers and lobbyists that he says is conspiring to keep Turkey’s interest rates artificially high.

“We can’t make this a taboo,” he said, rejecting the idea that central bank independence means he shouldn’t comment on interest rate policy.

The comments come as a slew of economic stimulus measures implemented in the wake of a 2016 coup attempt have helped push growth up while driving core inflation to 11.8 percent in October, the highest since 2004.

“We’re back at Erdoganomics 101,” said Cristian Maggio, head of research at TD Securities in London.


“I would have expected him to start shouting at the central bank only once the lira was on a more solid footing versus the U.S. dollar and euro. We’re clearly not there yet, so that makes me think that he’s more concerned about growth, a concern that we share.”

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Schmuck Raker's picture

Local BTC premium at 50% in 3, 2, ...

Ghost of PartysOver's picture

Murica has some stiff competition in the race to reach Peak Stupidity.

CriticalUser's picture

44magum wants to reach Peak Stupidity: he has suggested a (((jewish conspiracy))) having place at the Turkish Central Bank... Some people know no shame...

DownWithYogaPants's picture

Welll.  Who does run the Turkish likely private central bank now?

If you are supposed to not comment about it I would suggest that's a good indication it's the same people in the USA whom we are not supposed to comment about.

That's my noncomment about the matter.

BobEore's picture

Let's see if I can threadjack this thing back on track to something remotely on point with the topic - of plunging liras for instance...

since as we have seen with all the rest of the recent "Turco-oriented" posts here lately... they routinely and quickly descend to anything but... the topic on hand! MERIKAN EXCEPTIONALISM at its finest!

When I first bought gold - and silver - produced by Turkish refineries, and sold by Turkish jewellers, back in 2010...

the lira was 1:150 USD/TL, and gold was trading at @ 67 lira a gram. It took out 1.60/gr for the first time last week, and is heading due north as we speak.

Having told EVERYONE AND HIS BROTHER here back at that time, to BUY GOLD and get ready for steady...

depreciations, to be met by knowing smiles and the usual b.s....
and then proceeded to try... for seven 'odd' years... to try and share my experiences and strategies on western message boards without being deluged by psychopathic poseurs trying to keep any real discussion from breakin out - at any cost...

I can look back on the long and rocky round of getting to here - (115% over averaged buy in cost - 133% over my 2010 purchases)with some satisfaction which compensates for the endless stream of venom spewed consistently from the mouths of witless bagholdin exceptionalists who 'knew everything' that I didn't bout holdin gold... in a post western world...

and hung themselves on their own petards of ignorance and conceit... from where they now look down pon and endgame which I carefully laid out in accurate detail for them in 2010.. https://storify.com/SuaveBel/precession-of-simulacra-the-new-tenochititlan

and updated with...

to give em a head start on dealing with Drumpf... and the last mile.

just so as no one coulds accuse me of not caring no more bout the kith n kin back in GULAGISTAN! wHo... NEVER TIRED of reamin me ... for bein right.

Thanks for all the fish!

DownWithYogaPants's picture

What the fuck was that unreadable gob of words?  

BobEore's picture

You mad bro?

Sorry things haven't worked out for ya.
I didn't do it!

WTFRLY's picture

Someone needs to step on that Daesh cockroach

44magnum's picture

taking on the (((Independent central bank))) is a sure way to end your career or life.

CriticalUser's picture

What do you mean, that the TURKISH central bank is in jewish hands? Is that the conspiracy theory that you want to push forward? Present evidence please, otherwise i'll be forced to think that you are a moron that believe in drivel.

Conscious Reviver's picture

Ofyen true, but Erdo has his own security team and Russia riding shotgun. I think he'll be fine.

east of eden's picture

Well, the CIA has been out and about killing over 100 Russian diplomats in the last few years, so, what does Russia do? Well, they tell Cuba to unleash the hounds, and all of a sudden, virtually the entire US 'diplomatic corps' (read CIA), goes bonkers with ultra high frequency sound beams destroying their hearing and their heads.

Smarten fucking up, US. You're beaten. 

currency's picture

Erdogan is a Corrupt Dictator who fashions himself as an King of a failed Ottoman Empre. He and his family and friends are very corrupt.

The Sick Man of Europe????????

Vageling's picture

Another dude that was too busy sleeping in the classroom. Turkey is not part of Europe. It never will be. We're fine trading with them but they will never be embraced as Europeans, nor do the Turks desire so. And as long as Erdogan is in power they can forget sticking their hands in the EU (another institution that needs to be drawn and quartered) fund jar. Another fun fact, they're not Arabs either. Figure the rest out on your own. 

spastic_colon's picture

if i was an AI algo i could stay up 24/7 and buy every market dip in every market in the first 2 minutes of trading.............

Zeej's picture

Wow erdogan saying it like it is

Vageling's picture

Yup. Sometimes this dude has a point. Accept... Never forget who this POS is. Bad for business. With him there's always something, fraud, corruption, money laundering... Whatever it takes and that's why he's toxic.

Jtrillian's picture

Sounds like Turkey needs some FREEDOM!

Vageling's picture

Not happening. He has alot of support; his people as well as the army. Mister Murat the bankster need to start looking over his shoulder now. Erdogan will do whatever to stay in power.

east of eden's picture

So, the end for the CB'ers is nigh. Turkey takes the lead role in throwing them to the curb, backed up by the considerable military muscle of Russi and and China, not to mention the armed capabilities of Tukey all on it's own.

kavabanga's picture
USDTRY update. It was obvious if know what does mean technical analysis.

we reach our target 5 times in USDTRY from (Aug to Nov),, congrats. 
After reach resistance at 3.8933, this pair stop bullish movement. 

for better setup, we can wait around 3.82954 to follow bullish wave and aim for 3.91220 as new target. 

Still no bearish signal for this pair, unless 3.81258 break down, coz that is our next bearish confirmation level. 

BritBob's picture
Turkey Holds Key Interest Rate at 8% as Expected

The Central Bank of Turkey held its benchmark one-week repo rate at 8 percent on October 26th, as widely expected, saying rising inflation poses risks on the pricing behavior while the economic activity is expected to maintain its strength boosted by both domestic and external demand. Annual inflation rate came in at a four-month high of 11.20 percent in September, way above the central bank's target of 5 percent, and core inflation hit 10.89 percent, its highest level since February 2004.

Sonder's picture

Are central banks ever on the right path? 

Maestro Maestro's picture


Kick the Americans out of Incirlik and kick America out of your economy by repudiating the petrodollar.

Until you do,

You Turks are the Americans' and the Jews' slaves despite what you may think of yourselves as being a proud and independent people.

The European whores know this very well.

Fuck the EU.