Fernando Alberca | Turkey’s central bank has announced that, as of 30 April, all bitcoin payments and exchanges of cryptocurrencies to fiat currencies will be illegal. This will prohibit “any direct or indirect use of cryptoassets in payment services and the issuance of electronic money”.
Crédito y Caución (Atradius) | The government and the Central Bank returned to more orthodox economic policies in H2 of 2020. Between September and December 2020 the Central Bank tightened the benchmark interest rate several times, by 875 basis points in total, to 17%. Despite this hike, inflation remains stubbornly high (15.6% in February 2021), and is expected to only gradually decrease in the coming months, due to persistent expectations of high inflation and ongoing price pressure triggered by a weak lira exchange rate. In mid-March 2021, the benchmark interest rate was raised again, by 200 basis points, to 19%. However, President Erdogan dismissed the governor of the Central Bank immediately after – the third dismissal of a governor in less than two years.
Ali Batuhan Barlas (BBVA Research) | Industrial Production (IP) grew by 11% yoy in cal. adj. terms in November, confirming a growth level in the first 2 months of 4Q20 (9%) similar to the strong 3Q20 performance (8.5%). We expect GDP growth to materialize near 5% in 2021, benefiting from a sizable contribution from external demand
Ali Batuhan Barlas / Adem Ileri / Berk Orkun Isa / Seda Guler Mert / Alvaro Ortiz (BBVA Research) | Turkish economy contracted by -9.9% in yearly terms in 2Q20 (-10.7% Bloomberg, -12.7% Reuters). The quarter-on-quarter contraction was higher at 11%. The growth rates in services and industry, sensitive to the Covid-19 shock, were the key factors behind.
In the opinion of Neil Dwane, global strategist at Allianz Global Investors, Turkey, confronted by growing structural challenges, especially the latest Lira crisis, needs a stronger response based in stricter fiscal and monetary policy, and a less confrontational foreign policy.
Shaun Riordan | The currency markets seem to have given the Turkish Lira a temporary respite. But the underlying problems remain the same: an unsustainable current account deficit; excessive dependence on foreign currency denominated (especially dollar denominated) debt; and high inflation.
MADRID | By Francisco López | Argentina’s devaluation contagion pulled downwards such different assets as Brazil Stock Exchange, Argentinian or South African currency , or even Indonesia’s bonds. In Spain, the Ibex fell again by 1.1% losing 6.7% points in just six days, which means its hardest time in past twelve months. When panic spreads, investors do not consider each countries’ economic circumstaces individually.
ISTANBUL | By Orhan Kemal Cengiz Radikal at via Presseurop | The recent report on progress in negotiations on Turkey’s accession to the EU finally deals sensitively with the issue and should trigger a calm debate among the Turkish public on its relationship with the Union, writes the star columnist of the influential “Radikal” daily newspaper.
NEW YORK | Obama didn’t manage to resume the peace process between Palestinians and Israelis because there was nothing to resume. The surprise is that his trip did work to boost Israel-Turkey relations.
ISTANBUL | Although a member of numerous regional and international organisations, Turkey is still not in the EU, despite negotiations dating back some 50 years. Öztin Akgüc wonders if the the country has missed its chance to become anything more than an auxiliary to US foreign policy in the Middle East.