Terwijl EU en USA zich druk maken om het Turkse vertrek uit het Vrouwenverdrag (op de eerste dag van de maand van de vrouw in Turkije, over Fuck you gesproken), is meer gaande dat voor het land belangrijk zal blijken.

Waar de USA en EU zich thans het meest druk om maken is dit:

Het Istanbul-verdrag is een akkoord dat gesloten is door landen die lid zijn van de Raad van Europa. In het akkoord wordt geweld tegen vrouwen erkend als mensenrechtenschending en vorm van discriminatie.

Maar ook dit weekend werd in Turkije de gouverneur van de centrale bank ontslagen. Een slecht signaal voor de economische stabiliteit van het land. Deze gouverneur had het gewaagd de Turkse rente met maar liefst twee procent te verhogen. Dat moet de Turkse president zowat een hartverzakking hebben opgeleverd – in diens visie verlaag je inflatie door de bankrente te verlagen, in plaats van te verhogen. Direct hierna was de internationale vraag hoe de Turkse president hiermee om zou gaan. Vanzelfsprekend was het goed voor de waarde van het Turkse pond:

Maar over de keerzijde maakten analisten zich weinig illusies:

Considering the upside risks to inflation expectations, the bank has decided “to implement a front-loaded and strong additional monetary tightening,” it said in a statement that is guaranteed to enrage Turkey’s dictator.

Het was een uitstekende zet om het internationale prestige van de TCB op te vijzelen. Maar lang duurde dat niet:

On Thursday, moments after the Central Bank of Turkey unexpectedly hiked rates by a whopping 200bps – double the consensus expectation – to 19% from 17%, the highest rate since the country’s panicked scramble to contain the collapse of the Turkish lira during the economic turmoil of 2018, we said that “unfortunately for Turkey – whose economy will now grind to yet another halt –  it had no choice: inflation had accelerated for a fifth month in February as oil rallied and the impact of last year’s lira weakness lingered, while capital outflows soared. The upward trend fueled expectations the central bank would try to rein in prices by raising interest rates… but nobody had expected a 200 bps rate hike.”

Het bijkomend gevolg was onvermijdelijk een economische stotteren van de Turkse economie.

Unfortunately for Turkey – whose economy will now grind to yet another halt – it had no choice: inflation had accelerated for a fifth month in February as oil rallied and the impact of last year’s lira weakness lingered, while capital outflows soared. The upward trend fueled expectations the central bank would try to rein in prices by raising interest rates… but nobody had expected a 200 bps rate hike.

Zodat de analisten kregen gelijk met hun constatering dat:

Also in our kneejerk response to the rate hike decision, we said that the relatively new CBRT head, Agbal, “was damned if he did and damned if he didn’t: on one hand the lira was plunging angering Erdogan, so he had to stabilize it… on the other the only way to do so was by hiking rates, which would anger Erdogan even more.“

Zodat President Erdogan in een reflex zijn gouverneur van de centrale bank aan de dijk zette – de vierde in 5 jaar, en steeds om dezelfde reden: het voeren van een gezond monetair beleid dat in gaat tegen de onderbuikgevoelens van de president.

Two days later, our cynical view proved correct again, because shortly after midnight on Saturday, and just two days after the larger than expected rate hike, Turkey’s President Recep Tayyip Erdogan fired the country’s third central bank governor in less than two years and replaced him with a fan of lowering interest rates.

De nieuwe gouverneur meldde dit weekend opgewekt:

“Under the duties and powers laid down by law, the Central Bank of the Republic of Turkey (CBRT) will continue to use the monetary policy tools effectively in line with its main objective of achieving a permanent fall in inflation,” the governor said in the statement released a day after his appointment to the role.

En:

Rate hikes will “indirectly cause inflation to rise,” he added, echoing Erdoğan’s view on the matter.
Kavcıoğlu became the fourth central bank chief in five years. In July 2019, Erdoğan dismissed Governor Murat Çetinkaya for not bringing interest rates down swiftly. He also dismissed Çetinkaya’s replacement, Murat Uysal, in November last year after the lira slumped to its record low.

Speculanten in de valuta van opkomende economieën zullen Erdogan dankbaar zijn. Graties geld krijg je niet vaak, maar de beslissingen van de Turkse president op dit vlak zijn merkwaardig consistent.

Opmerkelijker is dat de president een bankier heeft gevonden die zijn meningen over rente onderschrijft. Hiermee wordt een nieuwe periode van economische instabiliteit ingeluid, en dat kan bijna niet goed gaan. Ook tijdens eerdere periodes dat TCB-gouverneurs deden wat moest, tegen de uitdrukkelijke wens van hun president in, verliep het scenario volgens een intussen geijkt patroon. De internationale speculanten hebben aan de Turkse president veel geld te danken. Èn een grote economische crisis, die door deze gebeurtenis in gang zal worden gezet:

Turkey has become the sovereign equivalent of a Swiss Watch: every 6 months or so Turkey has a brand new crisis, and the latest one arrived late on Friday when just days after the Turkish Central Bank hiked rates by 200bps, double the consensus expectation (a move which we correctly predicted would provoke Erdogan “to replace yet another CBRT governor”), Erdogan indeed announced that CBRT governor Naci Agbal – who was on the job just over 3 months after his November 2020 appointment – would be fired and replaced with some political zealot named Sahap Kavcioglu, whose only claim to fame is believing in the ludicrous and farcical concept of Erdoganomics where lower rates somehow magically lead to lower inflation. He is also the country’s fourth central bank governor in the last two years.

Waaraan moet worden toegevoegd:

Sadly for Erdogan (and Turkey’s population) that’s not how the real world works and now that Turkey’s attempt to tighten and contain inflation by cutting rates inflation is about to explode in one of the most important Developing Markets; but what’s worse for international investors – who once again took a gamble on Turkey and lost – is that Erdogan just single-handedly crushed what little credibility the country’s central bank had built up in recent months and in early Asian trading, the Turkish Lira cratered as much as 17%, wiping out 5 months of progress, with the USDTRY soaring as high as 8.42, up some 120 pips its Friday close of 7.2185.

En ook:

… is that Turkey is now effectively without FX reserves and has virtually no way to short-circuit the current puke. Last year, Turkish banks spent more than $100 billion of the nation’s foreign reserves to support the sinking currency, according to a Goldman report (full report below). That prompted calls by Turkish opposition for a judicial probe into the nation’s official reserves.
In comparison, always oblivious foreign investors who are confident that central bankers will always save them, purchased a net $4.7 billion worth of Turkish stocks and bonds in the months following Agbal’s appointment. Overseas inflows to Turkey through swaps were about $14 billion during that period, Istanbul-based economist Haluk Burumcekci said. All that money is about to be pulled now amid the sheer chaos.

Global markets, bond yields slid and the Turkish lira plunged towards a record low against on Monday after President Tayyip Erdogan shocked investors by replacing the country’s hawkish central bank governor with a critic of high interest rates, Turkey’s 4th new central bank head in 2 years.

However the global weakness took place against a backdrop of a pending short squeeze in the US, and despite the Turkey slaughter, the weakness was faded as the Emini S&P and Nasdaq 100 futures climbed alongside European technology shares on Monday as a drop in Treasury yields boosted pricier parts of the stock market.

Later deze week volgt nog een analyse van de voorgenomen Turkse buitenlandse campagnes zoals die nu vorm beginnen te krijgen.  Waarbij de vraag zal blijven in hoeverre Turkije het zich financieel-economisch zal kunnen blijven permitteren op zoveel fronten tegelijk te blijven spelen zonder een economische ineenstorting te beleven.

Waar niemand een serieus woord over zeggen kan, is de (vetgemaakte) vraag die hieronder wordt gesteld, maar die komende maanden prangender zal worden:

One final question we have that has not been addressed by Wall Street, is how much longer will the Turkish population tolerate Erdogan’s increasingly erratic behavior which is now dramatically and adversely impacting the livelihood of this extremely geopolitically valuable nation. And, related to that, how long before this currency, debt and sovereign crisis morphs into a political crisis, leading to another “coup”, although much less fake than the 2016 one…

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Nieuws over Turkije (hier) onder Erdogan op Veren of Lood vindt u hier. Ons dossier-over Syrië (sinds 2015) staat hier. Vanwege de Turkse invasie van Syrië hebben we daarover een speciaal dossier gecreëerd, dat u hier vindt.