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Turkish lira plunges 10% after Erdogan defends rate cuts

A man pays for his food at the Egyptian bazaar in Istanbul, Turkey, Thursday, Nov. 18, 2021. (AP Photo/Francisco Seco)
A man pays for his food at the Egyptian bazaar in Istanbul, Turkey, Thursday, Nov. 18, 2021. (AP Photo/Francisco Seco)

The Turkish currency weakens by nearly 10% against the US dollar, a day after President Recep Tayyip Erdogan insisted there would be no turning back from his unconventional policy of cutting interest rates despite high inflation.

The lira plunged to a record low of 12.51 against the dollar — down 9.9% from Monday’s close. The currency was trading at 14.08 against the euro. The lira has lost some 40% of its value since the start of the year.

Erdogan, who had declared himself an “enemy” of high borrowing costs, portrayed his economic policies as “an economic war of independence” during a late-night televised address to the nation. He made clear that his government would not step back from its policy of lowering borrowing rates to boost growth.

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