Daily Times

Turkish Finance Minister Berat Albayrak does not expect a big risk to the economy or financial system, he was quoted as saying on Wednesday, amid what investors say is a widening crisis caused by a sell-off in the lira.

The lira has lost around 40 percent of its value this year, driving up the cost of fuel and food and heightening concern about an economic downturn and risks to banks.

The currency has been weakened by worries about President Tayyip Erdogan’s grip on monetary policy and worsening rift with the United States.

Ratings agency Moody’s on Tuesday sounded more alarm about Turkish banks, downgrading 20 financial institutions and citing the increased risk of a deterioration in funding.

However, the newspaper Hurriyet quoted Albayrak, who is Erdogan’s son-in-law, as saying he did not see a major threat to the economy.

“We do not see a big risk about Turkey’s economy or financial system,” he told reporters on his flight back from Paris earlier this week, according to Hurriyet.

There were no risks because Turkey’s net public debt and household debt are low and its financial system is strong, Albayrak said.

The newspaper also quoted him as saying that steps would be taken to prevent foreign currencies from being used for real estate and shopping-mall store rents and sales. Retailers in Turkey’s malls, which often pay their rent in dollars, have also said their businesses were suffering due to the ailing lira.

Published in Daily Times, August 30^th 2018.