Turkish central bank raises key rate and helps lift currency
ANKARA, Turkey (AP) — Under pressure to act, Turkey's central bank sharply raised its key lending rate Wednesday to try to stem an outflow of capital from the country, control inflation and support the beleaguered currency.
The Turkish lira regained some of its value after the bank's monetary policy committee held an emergency meeting and announced it was raising the rate from 13.5 percent to 16.5 percent. The value of the lira responded by rising to around 4.58 per dollar, after it had dropped to over 4.80 per dollar, down about 5 percent since the previous day.
The rate increase came despite President Recep Tayyip Erdogan's insistence that rates be kept low. Higher rates can support a currency and ease inflation.