Turkish central bank cuts key rate despite weak lira, high inflation

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Turkey’s central bank on Thursday slashed its key interest rate to 15 per cent, the third consecutive cut since September despite market warnings that lower rates will trigger higher inflation and send the lira even lower. The bank cut the rates by 100 basis points a day after President Recep Tayyip Erdogan vowed to push for lower interest rates. The lira slid to 10.92 against the US dollar. The currency had recouped some losses earlier on Thursday. Erdogan, an outspoken opponent of high interest rates, believes that they cause inflation contrary to orthodox economic theory. On Wednesday, Erdo…

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