Archive for December, 2010
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‘Confuzzled’ by the Central Bank of Turkey
I elaborate on most of the points raised in this column in a piece published in the Emerging Markets EconoMonitor before the MPC meeting. One particular point I make is that hiking the reserve requirement is likely to increase the credit interest rate marginally and could even increase the quantity of liquidity. That point is explained in detail in another contribution about the CBT’s decision by Chevelle of the blog Models & Agents. In addition, I take on whether the Turkish economy is overheating/overheated at an earlier contribution.
The Central Bank of Turkey, or CBT, did not surprise at all on Thursday when it cut the policy rate from 7 to 6.5 percent. Friday’s reserve requirement hikes were in line with expectations as well.
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Turkey: To Cut or Not to Cut
Although I claimed it would be unwise to do so at the end of my latest Roubini Global Economics contribution (updated version of this week’s Hurriyet column, although the updating only changes one word, “credible” to “wise” in the last sentence, as the weekend presentation has made it credible all right), it looks likely that the CBT will be cutting the policy rate tomorrow: Vice Governor Erdem Basci, noted as the most likely successor to Governor Yilmaz in a U.S. Istanbul Consulate WikiLeaked cable, in an emergency presentation at the Turkish Economic Association, clearly spelled out that a policy rate cut would be on the agenda at tomorrow’s MPC meeting.
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Turkey: Burnt by the Winter Sun
Did the cold front sweeping through Turkey hit third quarter Gross Domestic Product, or GDP, numbers first?
According to data released by the Turkish Statistical Institute Friday, GDP grew 5.5 percent year-on-year, or YoY, in the third quarter, versus expectations of 6.5 percent. But the economy still managed to grow 1.1 percent, seasonally and working-day adjusted, from the last quarter, so I think this is still quite a good reading. It seems that the cold front has actually passed tangent to the economy, to quote the Prime Minister.
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More on Turkish Housing Statistics
There have been important developments since I wrote on housing statistics last week, so yet another addendum is in order.
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WikiLeaks Cable on Turkish Economy
Your friendly neighborhood economist recently stumbled upon a WikiLeaked United States’ Istanbul Consulate cable on the Turkish economy, dated Nov. 31, 2010, which he is duly passing along:
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Turkey: The Desperate House-Economist
I am prone to getting confused quicker than you can say Confucius, so it is no wonder that two recent, and seemingly conflicting, data on housing managed to profoundly baffle your friendly neighborhood economist, who had become a self-proclaimed house expert some time ago.
