Mirroring the emptying of supermarket shelves around the world, indebted corporates have rushed into money markets to hoard dollars, with a global shortage of greenback funding threatening to cripple firms from airlines to retailers.
Turkish central bank has underlined that the downside risks of the year-end inflation projection have risen, led by a mild trend in core inflation indicators.
The Federal Reserve took emergency action to help the economy withstand the coronavirus by slashing its benchmark interest rate to near zero and saying it would buy $700 billion in Treasury and mortgage bonds.
The fallout from the 2008 global financial crisis refuses to go away and now leading economists may be looking to upend traditional neoliberal economic policy.
Stocks are slipping in early trading on Wall Street as traders hold back ahead of an interest rate announcement from the Federal Reserve.
It remains to be seen if the measures are enough to spur spending.
The bank lowered its one-week repo rate 325 basis points from 19.75 percent to 16.50 percent.
The Governing Council holds its next policy meeting on September 12 and has all but promised a stimulus package, with economic growth faltering as a global trade war rumbles on and Germany’s manufacturing sector already in recession.
The inflation rate will fluctuate between 11.5 percent and 16.3 percent through the end of this year, Central Bank Governor Murat Uysal said during Inflation Report 2019.
Finance and Treasury Minister Berat Albayrak says over $10 billion in foreign investments entered Turkey since May, and the Turkish economy will grow "positively this year."
The Fed's move came despite President Donald Trump's attacks in recent weeks on its rate hikes and on Chairman Jerome Powell personally.
The Turkish Central Bank on Wednesday forecasted Turkey's year-end inflation rate to reach 23.5 %, adding it would fluctuate between 21.9 % and 25.1 % through to the end of year.
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