Comments this week from Turkey’s new central bank governor, Murat Uysal, and President Erdogan suggest that an interest rate cut at next week’s meeting will be followed by further aggressive easing in the coming months. But we think that this will put downward pressure on the currency and exacerbate the country’s inflation problem. Elsewhere, victory for Ukrainian President Volodymyr Zelensky’s party in Sunday’s parliamentary election is likely to raise hopes that the government will be able to push through IMF-mandated reforms.
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