Turkey’s Central Bank Is Walking a Tightrope Between Erdogan and Markets

(Bloomberg) -- What economy has Murat Uysal inherited as Turkey’s new central bank governor? Bloomberg Economics’ dashboards shows economic growth slowed in the second quarter as stimulus was withdrawn. With inflation falling, conditions are now ripe for an interest-rate cut -- but the decision will be scrutinized by markets wary of political interference. The irony for President Recep Tayyip Erdogan is that a rate cut was probably coming regardless of who led the central bank. The currency may be more sensitive to policy moves if Erdogan is seen to be calling the shots, which could a risk a repeat of last summer’s crisis.

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