Turkey: Elections Delayed Because of the Lira Rate Collapse

Turkey’s President, Tayyip Erdogan, rejected the possibility of early presidential and parliamentary elections given the fall of the Turkish lira in the exchange rate.

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"I declare that the elections will be held in June 2023. There will be no early elections. I am putting an end to [this issue]," announced the Turkish leader at a meeting of the parliamentary faction of the ruling Justice and Development Party.

"We have stated that we will not put pressure on our people either with interest rates or inflation, and we are fighting for this. We are on the verge of a breakthrough, and we will achieve the results we want," Erdogan said.

Turkish authorities implemented a unique tool to protect private deposits in Turkish liras. The tool, announced on Tuesday, has as its objective boosting interest in deposits in the national currency amid its excessive volatility this year.

With this tool, the state guarantees to every individual who opens an account the balance of their funds over losses due to changes in the exchange rates or the interest rate by the time they close it.

By November, the rate exchange of the Turkish lira fell almost a third compared to the beginning of the year. The fall is believed to be caused by the Central Bank's policy, which continues to decline the rate under the pressure of the authorities.

The regulator lowered the key rates from 15 percent to 14 percent. On Monday, the Turkish lira fell to 18 liras per dollar, but after the Turkish authorities announced the new measures, the national currency was restored by 30 percent.