Turkish Lira tumbles after Erdogan fires central bank chief

Ankara

The Turkish lira tumbled on Monday as President Erdogan sacked the country's central bank chief Naci Agbal.

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The Turkish lira fell 17 per cent sliding 8.47 per US dollar in early trade on Monday even though it recovered slightly later at 8.09. 

Agbal's sacking came just a day after the country's central bank hiked interest rates by more than two percentage points to 19 per cent in a bid to fight inflation.

Agbal was appointed less than five months ago but has been replaced by Sahap Kavcioglu who has been an open critic of Agbal's policies.

In July 2019, President Erdogan had sacked central bank chief Murat Cetinkaya for not bringing interest rates down swiftly and had replaced Murat Uysal after the currency slumped to a record low.

Kavcioglu is the fourth central bank chief in five years in Turkey as the country battles economic crisis amid the pandemic.

Kavcioglu asserted that the bank would focus on lowering the double-digit inflation even though Agbal's rate hike of 200 basis-points on Thursday had sparked an over 3 per cent lira rally.

The lira has reportedly lost half its value since the 2018 currency crisis.