Will Turkish Central Bank practice ruin the country and spend its gold ?

Hi Finance people,

For those living in Turkey I foresee dark times if not already.

Why?

Where Turkey in the past had times before with high inflation and decreased value of the Lira, they always tried to limit the effect with well accepted monetary policy like increasing interest rates (to stop consuming) above inflation level.
Now with the economy on halt due to Corona the former Central Bank was fired and his hand-picked successor applies the policy of the countries leader:

• keep interest rates low (causing people to borrow cheap and swap to gold or foreign currency)
• support the currency with selling foreign currency reserves and buying Lira

But now it is revealed that the Central Bank BOROUGHED the foreign currency from the local banks AND now they owe these local banks more currency than they have themselves. The local banks suing the central bank ??? Do you see this happen? And to make matters worse the Lira dropped further making import really expensive.

The Central Bank now tries to conserve the foreign reserves including the central gold reserve. As always gold is the last resource in bad times. Turkey still has 45 B USD reserves or 90 B USD including gold reserves. Will they also use this gold maybe ? Who is gonna check this ?

Hope everything is better in some years from now!

Goldrooster

Posted Using LeoFinance