Comments from Poland’s central bank this week highlighting the risk that a stronger currency would hold back the economic recovery suggests that policymakers view the exchange rate as a tool that has been blunted during the current crisis and that they may pursue a more aggressive monetary stance. Meanwhile, the Turkish Wealth Fund’s acquisition of a controlling stake in the country’s largest mobile phone operator adds to the evidence that the state is taking a more active role in the economy. This increases the risk of a misallocation of resources that exacerbates problems in the banking sector.
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