Erdogan says market volatility does not reflect Turkey's economic reality

Thousands of members of President Recep Tayyip Erdogan’s party traveled to Ankara from around the country for the AKP’s grand congress on Wednesday. The meeting came as Turkey is facing a dramatic surge in coronavirus cases which signals a a stronger spike should be expected in the coming days.

Among many comments Erdogan made during his very long speech, focusing on economy related messages are as below:

– Recent volatility in financial markets does not reflect the Turkish economy’s realities and international investors should maintain their confidence in Turkey.

– Turks who keep foreign currencies and gold at home should invest them in financial instruments, bringing them into the economy and production.

– Turkey proved resistant to all kinds of shocks with its fiscal discipline and commitment to the free market economy.

– Erdogan added that the economy would improve on the basis of investment, production, employment and exports.

– He did not mention the misfortunes related with the central bank monetary policy management. Erdogan altered the system and changed the governor four times in the past 2,5 years making the system extremely volatile and uncertain.

The lira has tumbled in value, stocks have slid and bond yields jumped after Erdogan’s surprise weekend move to replace the central bank governor with a critic of tight monetary policy. The lira weakened beyond 8.0 against the dollar on Wednesday, bringing losses since Friday to around 10%.