Friday 01st August 2014,
Turkish Market News

The Revival Of “Hyperinflated” Turkish Lira

The Revival Of “Hyperinflated” Turkish Lira

Inflation targeting is a successfully pursued monetary policy in countries who suffered high inflation for years such Zimbabwe. Turkey also set a new policy framework in purpose to lower the inflation and stabilize the currency rates. Under normal circumstances interest rates are expected to raised by the central bank provided that Turkey is an economy [...]

July 3, 2014 Oguz Erkol Macro View 0

One Chart On Turkey’s Growth Dilemma

One Chart On Turkey’s Growth Dilemma

All agents in the country excluding the government walk on eggs while making an investment decision. This is usual when the private sector influence by the added insecurities and domestic and foreign macroeconomic developments. On the other hand in a country where a housing bubble about to burst exists, this is also alarming. Therefore I [...]

June 25, 2014 Oguz Erkol Macro View 0

The Limits of Rationality in Monetary Policy

The Limits of Rationality in Monetary Policy

When your search for “central bank government pressure” on Google, the top three results are related to Turkey just hours before the monetary policy committee meeting to take place. Central bank independence has been one of the most important policies imposed by the International Monetary Fund in less developed countries since mid 90s. And so [...]

June 24, 2014 Oguz Erkol Macro View 0

The Role of State in Credit Crunch

The Role of State in Credit Crunch

Only limited number of voluminous bagfuls of hot air have been spent by various economists about the alleged shortage of liquidity in the Turkish financial system that I have written in the past (see here, here, and here). Rather than repeating myself in a blog post by questioning the availability of cash in Turkish banking [...]

June 23, 2014 Oguz Erkol Macro View 0

Banks to Stay Under Pressure

Banks to Stay Under Pressure

One of the main functions that banks provide is liquidity transformation. To simplify this financial term, one can interpret it as funding shorter term assets with longer term liabilities. In case of  failure of this process, the banks face a liquidity mismatch which would put them at serious risk. Like any of its peers in [...]

April 24, 2014 Oguz Erkol Business Reports 0

On the Failure of Inflation Targeting

On the Failure of Inflation Targeting

Right after the shocking rate hike by Turkish Central Bank and the elections that is thought to have removed the political risk, we began to see Turkish lira not under pressure anymore, unlike the central bank. Firstly, let us remember the deep thoughts Turkey’s Finance Minister on the economy, SIMSEK SAYS TURKEY ‘WON’T WASTE THIS [...]

April 16, 2014 Oguz Erkol Macro View 0

Political Risks Over? Not Yet

Political Risks Over? Not Yet

Concerns about Fed over-optimism admission and shortening the time from taper to rate-hike somehow did not spark a major risk-off dump in Turkish equities. Equities are traded just below the previous day’s close while major banks such as Halk, Is, Vakif, Yapi are in green territory. Meanwhile bonds are having a bad day as 2-year [...]

March 20, 2014 Oguz Erkol Macro View 0