Turkey's Central Bank Implements Aggressive Interest Rate Hikes to Tackle Inflation

Turkey's central bank has raised its key interest rate to 30% in an effort to combat double-digit inflation and stabilize the weakening Turkish lira. The decision follows a series of rate hikes aimed at reversing years of skyrocketing inflation and a significantly weakened currency. The lira has lost 30% of its value against the dollar this year and 78% in the last five years. Turkish President Recep Tayyip Erdogan, who has been critical of interest rates, appointed policymakers committed to implementing economic orthodoxy to address the inflation issue. The central bank aims to bring inflation down to 5% in the medium term, but current forecasts predict it will reach 65% by the end of 2023.