Turkish central bank governor fired by decree from Erdogan
Murat Cetinkaya, who had been serving as governor since April 2016, is to be replaced by his deputy Murat Uysal, the decree said, without citing any official reason for the change.
The bank has been under pressure from Erdogan to cut rates as opposed to market calls for a hike to rein in stubbornly high inflation.
Ratings agencies and analysts have long called on the bank to hike interest rates, and its refusal to do so has raised questions about its independence.
Last month, Moody's downgraded Turkey's credit score from Ba3 to B1 and maintained a negative outlook, citing concerns about the central bank's "transparency and independence."
The bank has kept its benchmark rate steady at 24 per cent since September when it was hiked by 625 basis points.
Back then, Erdogan lashed out at the bank, saying he was running out of patience with high rates. The conservative Islamic president had referred to interest rates as the "mother and father of all evil in the economy" in May last year.
Cetinkaya's ousting comes amid speculation in local media that he might be replaced due to his refusal to cut rates as demanded by Erdogan's government.
The Turkish economy entered recession at the end of last year. It exited recession in the first quarter, but shrank 2.6 per cent when compared to a year ago, according to official statistics institute TurkStat.
Inflation slowed to 15.7 per cent in June from 18.7 per cent in May, TurkStat said on Wednesday.
The bank will continue to "independently" implement monetary policy to realize its "primary objective of price stability," the new governor Uysal said on Saturday in a statement on the bank's website.
Uysal had been deputy governor since June 2016. He will hold a press conference "in the coming days," the bank said.
The bank convenes on July 25 for its monthly monetary policy meeting.
The main opposition Republican People's Party (CHP) harshly criticized Erdogan's office as denting the bank's independence. "The central bank of Turkey has become a hostage of the [presidential] palace," CHP spokesman Faik Oztrak tweeted on Saturday.
"The CBRT credibility was already shot to hell, this move just takes it back further," Timothy Ash, emerging markets sovereign strategist at BlueBay Asset Management, wrote on Twitter, using the abbreviation for the Central Bank of the Republic of Turkey.
