The Turkish Lira hit a new low of 7.9389 against the dollar. Also Turkey’s net international reserves totaled $40.9 billion in January, but had more than halved by Sept. 25, measuring a mere $16.9 billion.
International experts warn that one of the major reasons for this is Turkey’s geopolitical issues (including its recent involvement in the Nagorno-Karabakh conflict) and its authoritarian regime. “Turkey’s financial problems are deeper, and related to the changes in political institutions — in other words the degree to which the country has become more authoritarian,” said Erik Meyersson, senior economist at Handelsbanken Macro Research in Stockholm.
Event though the Turkish Lira hits new records everyday and the International Reserves have reached the critical line, Erdogan continues spending money on its military “speculations”, putting in danger the prosperous and peaceful future of the Turkish citizens.
“Ankara is left between a rock and a hard place, and has no easy way out of any of the conflicts it finds itself embroiled in for fear of appearing weak domestically or internationally,” said Agathe Demarais, global forecasting director at the Economist Intelligence Unit. “There is therefore little chance that Turkey will seek to assuage tensions in any of the conflicts it is a major player in. In turn, this means that more lira volatility is on the cards.”