Turkish Central Bank
Douglas Winslow from Fitch said that Turkey's economy will catch up with its sustainable trend of growth next year. "In the first quarter of this year economic growth had accelerated to above 6%. We now anticipate a very sharp contraction in the second quarter, flatter growth in the third quarter and then recovery in the fourth quarter, as activities begin to normalize after the partial lockdown," he said.
Turkey's Central Bank has become the largest gold purchaser in the world in January and February of this year, with 41 tons of gold. Turkey was followed by Russia (19 tons), the United Arab Emirates (5.9 tons), Kazakhstan (2.8 tons) and Mongolia (1 ton).
Turkey's Central Bank provided more stimulus for the financial sector and economy on March 31, saying it would ramp up government debt buying and offer new pools of cheap funding to stem the fallout from a growing coronavirus outbreak. The Central Bank also extended 60 billion lira ($9 billion) worth of rediscount credits and added more lending options well below its 9.75% policy rate. It said the moves would provide much needed credit to companies and liquidity to government debt markets.
Selva Demiralp writes: Things are different in Turkey. We could hardly reach the inflation target even at the most favorable times and gave in to populist policies. Thus, mismanaged debt monetization can lead us all the way to hyperinflation. The way to prevent inflation is to drain the money effectively just as demand starts to pick up.
Turkish President Recep Tayyip Erdoğan issued a decree on March 20 postponing all events related to science, culture and art, as it seeks to contain a surge in coronavirus (COVID-19) cases. The decree published in the Official Gazette said all meetings and activities, indoors or outdoors, related to science, culture, art and other similar fields would be postponed until the end of April.
President Recep Tayyip Erdoğan has said that the financial developments that take place in relation to the decrease in oil prices will provide additional advantages to Turkey. Speaking during a high-level coronavirus meeting, Erdoğan said that Turkey is in a much better situation than Britain, France and Germany.
International credit rating giant Moody's warned Turkey that negative real interest rates could hurt the Turkish Central Bank's credibility and lower investors' trust. The practice of having interest rates on loans that are lower than the inflation rate, negative real interest rates make Turkey more hazardous rather than risk-averse for investors, Moody's added.
Turkey's current account balance posted a deficit of $2.8 billion in December 2019, the Turkish Central Bank said on Feb. 14. Official data showed that the figure widened by $1.7 billion from same month the previous year.