Foreign exchange and commodities:Turkish lira at record low
The Turkish President Recep Tayyip Erdoğan interferes again in the personnel policy of the Turkish central bank. The rate of the local currency is falling. Gas and oil prices are rising again on the raw materials market.
The euro exchange rate moved little on Thursday. The common currency was quoted at just under $ 1.16 in the evening. The focus on the foreign exchange market was the Turkish lira. Turkish President Recep Tayyip Erdoğan has once again interfered in the central bank’s personnel policy, paving the way for new interest rate cuts. He dismissed the two deputy central bank governors Semih Tumen and Uğur Namık Küçük and Abdullah Yavaş, the most experienced member of the monetary policy committee. Küçük and Yavaş recently annoyed the self-proclaimed “interest rate enemy” Erdoğan because they had resisted the interest rate cut that was decided last month. The financial markets were not impressed, especially since Erdoğan had already dumped three central bank governors within two and a half years. The rate of the local currency, the lira, temporarily fell to a record low of 9.1900 against the dollar. This year alone it has lost around 19 percent of its value. According to observers, this is also due to Erdoğan’s constant interference in central bank matters, which undermine confidence in the independence of the monetary authorities and in the lira.
The rising demand at the beginning of the heating season drove European natural gas prices up again. The futures contract traded on the ICE gained 9.3 percent to 102.35 euros per megawatt hour. According to analysts, price drivers are rising demand in view of the cooler weather and the continuing uncertainty about Russian supply in the coming months. The oil price also rose. The price for the European oil type Brent rose by 0.3 percent to 83.41 dollars per barrel, making up for the decline on Wednesday somewhat. “An unexpectedly sharp decline in US gasoline and distillate inventories led to new purchases,” said Kazuhiko Saito, chief analyst at Fujitomi Securities.
© SZ from October 15, 2021 / amon, Reuters, dpa