Armstrong Economics Blog/The Hunt for Taxes
Re-Posted Nov 16, 2018 by Martin Armstrong
Since the beginning of the year, the Turkish currency has lost more than a third of its value against the dollar. As the currency declines, imports rise in cost since they are denominated in foreign currency. This adds to the inflation problem domestically. Among other things, the sharp criticism of Erdoğan in the markets has cast doubt on the independence of the central bank. In September, it raised its key interest rate from 17.75 to 24 percent in the fight against inflation without success. This too adds to inflation.
There are people starting to look at tax cuts in selected areas to compensate for the crisis in hyperinflation. It is an interesting proposal but Erdoğan is worried about a real coup this time.