Ankara - Turkey's deputy prime minister spoke out against President Recep Tayyip Erdogan on Friday, saying it was "not right" for the country's leader to "threaten" the central bank.
Erdogan has rattled markets in recent weeks with his fierce criticism of the nominally-independent central bank over its reluctance to aggressively lower interest rates.
But Deputy Prime Minister Bulent Arinc, a close Erdogan ally, said that the bank was "doing its best" and was acting in a "wise and cautious way" when taking decisions on its monetary policy.
"It was not a right thing to threaten the central bank. From now on nothing should be spoken against the bank," Arinc said in a live interview with private NTV television.
"A president should only lead the way. A president's statements could be misinterpreted. The Westerners tend to become concerned over such rows," said.
The central bank has pruned rates it rates recently but by far less than Erdogan wants to stimulate flagging growth ahead of June legislative elections.
The row has sent the Turkish currency to a series of historic lows during the past month. The lira has since mid-January dropped more than 11 percent in value against the greenback.
In afternoon trading on Friday, the lira hit a new record low in value of 2.6330 to the dollar, having broken through the psychological barrier of 2.6 on Thursday.
"I believe that the constant criticism of the central bank governor and the doubts cast over the (economy) through the bank may have had an effect on the rise of the dollar" against the lira, said Arinc.
Meanwhile Erdogan blames the lira's weakness on speculators and what he calls an "interest rate lobby" that tries to hamper Turkey's growth through higher rates.
He warned Friday that "those who invest excessively in the dollar may end up being disappointed."
Erdogan also said that he would hold talks with central bank governor Erdem Basci and Deputy Prime Minister Ali Babacan after the latter returns from a visit to New York.
Babacan, Prime Minister Ahmet Davutoglu and Finance Minister Mehmet Simsek have been meeting foreign financiers in New York since Wednesday in a bid to allay concerns over the country's economic management.
Davutoglu told reporters in New York that he had spoken with Basci about the lira's fall, saying "every kind of measure" on the issue would be taken if necessary.
There have been rumours in the past days that Basci and Babacan -- the Turkish officials most trusted by the markets -- were set to resign.
AFP
