Turkey’s Erdogan picks Wall Street vet to head central bank
Turkey’s newly re-elected President Recep Tayyip Erdogan has appointed a former Wall Street executive to head the country’s central bank, a possible shift towards more orthodox economic policies after years of high inflation and a falling lira.
Erdogan named Hafize Gaye Erkan as the new central bank governor in the Official Gazette on Friday.
Erkan, a Princeton graduate, was a managing director at Goldman Sachs and later worked at the now-failing San Francisco-based First Republic Bank, serving as co-CEO for six months in 2021.
During his tenure on Wall Street, Erkan gained a reputation for being “tough, smart and effective,” according to Kathryn Wylde, CEO of the nonprofit Partnership for New York City, where Erkan once served as a director.
She is now also the first woman to head Turkey’s central bank.
Analysts eyeing a return to economic orthodoxy
Erdogan unveiled his new cabinet last Saturday, which also included Mehmet Simsek, a world-renowned former Merrill Lynch economist who is known for opposing Erdogan’s economic policies, as finance minister.
The appointments of Erkan and Simsek to top financial posts are seen by many analysts as an indication that Erdogan is moving to abandon policies that were previously labeled “unorthodox”.
Erdogan won a third presidential term last month amid a cost of living crisis fueled by inflation, which peaked at a staggering 85% in October.
Critics attribute the turmoil to Erdogan’s policy of lowering interest rates to promote growth, which goes against conventional economic wisdom.
After the lira fell again on Wednesday, Simsek said on Twitter that “our immediate priority is to strengthen our team and design a credible program.”
“As we navigate domestic and international challenges, we affirm our commitment to rule-based policy making to increase predictability,” added the new finance minister.
“While there are no shortcuts or quick fixes, rest assured that our experience, knowledge and dedication will help us overcome potential obstacles ahead.”
zc/lo (AFP, AP, Reuters)
Source: DW
Lori Barajas is an accomplished journalist, known for her insightful and thought-provoking writing on economy. She currently works as a writer at 247 news reel. With a passion for understanding the economy, Lori’s writing delves deep into the financial issues that matter most, providing readers with a unique perspective on current events.