Turkey President Erdogan Says Interest Rates to Continue to Fall

(Bloomberg) --

Turkey’s President Recep Tayyip Erdogan said interest rates will fall further and again boasted that his firing of the central bank governor has permitted a sharp drop in borrowing costs since July.

“With the appointment of a new central bank governor, interest rates declined to as low as 13.5 percent and rates will fall further,” Erdogan said in a televised speech in Istanbul on Saturday.

Central Bank Governor Murat Uysal has delivered three rate cuts since Erdogan appointed him in July, bringing the cumulative easing under his watch to 10 percentage points. The one-week repo rate, the main funding rate of the central bank, stood at 14 percent as of Oct. 24. Following the latest cut in October, Erdogan said that he had a“new friend” at the central bank.

Erdogan also suggested that inflation will be in single digits in 2020 and that the unemployment rate will start falling from September. Joblessness rose to 14% in August, with youth unemployment hovering at more than 27%.

To contact the reporter on this story: Ugur Yilmaz in Istanbul at uyilmaz@bloomberg.net

To contact the editors responsible for this story: Onur Ant at oant@bloomberg.net, Andrew Davis, James Amott

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