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Top Turkish bank official resigns as lira drops further

A deputy governor of Turkey's Central Bank quit suddenly today as the lira took yet another tumble.
ISTANBUL, TURKEY - AUGUST 29:  People wait to change money at a currency exchange office in front of the underconstruction, Taksim Square Mosque on August 29, 2018 in Istanbul, Turkey. Turkey's lira extended its slump to a third day to 6.45 against the dollar after the central bank announced it would alter Turkish banks borrowing limits on overnight transactions, the move failed to reassure investors and combined with the decision by ratings agency Moody's to downgrade the credit rating of twenty Turkish fi

One of four deputy governors of Turkey’s Central Bank relinquished his seat as the country’s battered currency took a further nosedive today after the Argentine peso fell to a record low on Aug. 29. Erkan Kilimci’s resignation comes a fortnight ahead of a critical meeting of the bank’s Monetary Policy Committee, where interest rates are decided. The bank is facing unremitting calls for a radical hike to bolster the plunging lira, which shed around 4% of its value against the dollar in trading today.

The lira has lost roughly 40% of its value against the greenback since the start of the year, adding pressure on banks and companies with high foreign currency liabilities. The International Monetary Fund’s latest staff report on Turkey, for this year and the next, projected the country’s overall external financing need to be in excess of $225 billion. The lower the lira drops, the harder it becomes to roll over foreign currency-denominated debt as it comes due.

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