Turkey replaces central bank head as lira sees record lows

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People walk inside historical Covered Bazar, one of homes of exchange offices in Istanbul, Friday, Aug. 7, 2020. Turkey’s currency tumbled further Friday, hitting another record low. The Turkish lira dropped to 7.3677 against the dollar before making a recovery. The lira is down about 19% versus the U.S. currency since the beginning of the year. (AP Photo/Emrah Gurel)

ANKARA, Turkey (AP) — Turkish President Recep Tayyip Erdogan on Saturday dismissed the head of the country’s central bank following a period of high inflation and record lows for the lira.

Former Finance Minister Naci Agbal was brought in to replace Murat Uysal, according to a presidential decree announced in the Official Gazette.

The decision came after the lira lost nearly a third of its value since the start of the year – hitting a record low of 8.58 against the U.S. dollar on Friday – and annual inflation stood at 11.89%.

Uysal was appointed chairman of the central bank in July 2019 after his predecessor failed to cut interest rates to boost the economy.

Erdogan has called for rate cuts, refuting established economic theory that high rates can rein in inflation. Last weekend he described interest and exchange rates and inflation as the “devil’s triangle”.

Erdogan and the country’s finance minister, his son-in-law Berat Albayrak, have often blamed Turkey’s economic woes on foreign powers.

Agbal was appointed from his previous post as head of the presidential strategy and budget directorate. He served as finance minister between 2015 and 2018.

His new role comes as Turkey fears worsening relations with the U.S. should Democratic nominee Joe Biden win the presidential race.

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