Turkish Finance Minister Says Growth Policy Won’t Risk Inflation

Turkey’s new finance minister said the government’s growth policies won’t jeopardize its fight against inflation, in his first public appearance as the nation’s top economy official.

“Turkey’s growth process will be designed and controlled in a way that doesn’t contradict our fight for macroeconomic stability and against inflation,” Treasury and Finance Minister Lutfi Elvan said Tuesday in a presentation to lawmakers at parliament’s Planning and Budget Commission. Turkey will enter a sustainable growth path in 2022 and 2023, Elvan said.

President Recep Tayyip Erdogan has sparked expectations of an interest-rake hike following the replacement of both the central bank chief and his son-in-law as finance minister. The central bank’s rate-setting committee is expected to raise the benchmark rate to 15% from 10.25% on Nov. 19, according to the median estimate in a Bloomberg survey of 24 analysts.

Here are some other highlights from Elvan’s speech:

  • Turkey plans a 120% rollover ratio in the domestic debt market in 2021
  • The Treasury plans to decrease the proportion and quantity of foreign-exchange debt in the local borrowing market
  • The government will continue switching bond auctions next year
  • The central government’s 2020 budget gap is expected to be less than the previously projected 4.9% of gross domestic product

©2020 Bloomberg L.P.

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