Inflation and Central Bank Independence - The Case of Türkiye
Updated: Feb 22
Amidst the current wave of inflation felt across the world the Republic of Türkiye has recently recorded some of the comparatively highest levels, reaching a 85.5% price increase for the month of October 2022. This coupled with the fact that the Turkish central bank has consistently refused to increase the interest rate going so far as to continue decreasing it has raised concerns about the stability and health of the Turkish economy, despite claims of a high GDP growth rate. In addition, and due to the fact that President Erdogan has been increasingly vocal on the unorthodox belief that increasing the interest rate actually leads to an increase in inflation, this has led to increased doubts on the independence of the central bank. But how do these doubts about central bank independence actually influence inflation? Read the following article to find out more.