The Turkish lira fell more than 2% on Wednesday, retreating towards record lows, as President Recep Tayyip Erdogan renewed his commitment to lower interest rates.
After rising in the Tuesday session, the lira fell 2.45% to 13.80 against the dollar by 1420 GMT compared to the previous close of 13.45 liras per dollar.
The Turkish currency has lost 46% of its value against the dollar this year, and touched an all-time low of 14.0 lira to the dollar last week.
The Turkish president described the process of hoarding hard currency as the cause of the economic crisis, warning that those who do so will be punished.
Erdogan defended the interest rate cut, stressing on Wednesday that Still not convinced of the high interest.
Erdogan has vowed that his country will control inflation through low interest, which is contrary to normal economic estimates.
The Turkish president said that Ankara would stand up to the war on the Turkish lira. The credit rating agency, Fitch, revised Turkey’s outlook to negative, affirming its rating at (bb-) and lowered its outlook on Turkey’s long-term debt default to negative from stable.
Fitch said that adjusting Turkey’s outlook reflects the central bank’s policy of monetary easing before its time, noting that its assessment reflects weak monetary policy credibility, high inflation, lack of external liquidity and geopolitical risks.