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Despite the decline of the Turkish Lira following the re-election of President Recep Tayyip Erdogan, Turkey’s inflation rate is showing signs of recovery.
According to data released by the Turkish Statistical Institute, Turkey’s consumer price index (CPI) rose by 3.92% on a month-on-month basis in June. Additionally, On a year-on-year basis, Turkey’s inflation rate rose by 38.21%, slightly lower than Reuters’ forecasts of 39.47%.
While still high by global standards, this reading came in lower than the forecasted 4.84% by Reuters and marked a significant tick compared to the 0.04% rise observed in May.
Among the various categories contributing to the CPI growth, tobacco, and alcoholic beverage prices experienced the largest gains, surging by 11.13%. This notable increase in prices for these goods likely influenced the overall CPI reading for the month.
Additionally, prices in the restaurant and hotel sector saw a modest increase of 4.31%, contributing to the overall inflation rate.
In recent years, Turkey has been grappling with stubbornly high inflation rates, which have adversely affected the purchasing power of its citizens and strained the overall economy. In a previous report, Wells Fargo’s Emerging Markets Economist and FX Strategist Brendan McKenna projected that the Lira could drop as low as 23 against the dollar.
However, the Turkish government has been implementing various measures to combat inflation.
In an effort to address the economic challenges, Turkish President Recep Tayyip Erdogan appointed Mehmet Simsek as the new Treasury and Economy Minister. Simsek, known for his market-friendly policies, is expected to bring stability and implement measures to tackle the economic difficulties in the nation
Additionally, the Central Bank raised the country’s key interest rate from 8.5% to 15% last month. The apex bank affirmed its commitment to further gradual monetary tightening until the inflation situation improves.
This unexpected development has caught the attention of economists and analysts, sparking discussions about the factors influencing Turkey’s inflation dynamics and the implications for the country’s economic outlook.
Conotoxia’s Market Analyst Bartosz Sawicki expressed a pessimistic outlook, stating that there is “little reason for optimism.” Sawicki’s perspective reflects a cautious stance toward Turkey’s economic situation, despite the recent moderation in inflation rates.
Sawicki noted that the recent freefall of the Turkish Lira is starting to have adverse effects on the economy, reigniting cost pressures. This perspective aligns with the notion that a weakened currency can lead to inflationary pressures, as imported goods become more expensive and businesses face higher production costs.
On the other hand, Timothy Ash, Senior EM Sovereign Strategist at BlueBay Asset Management, acknowledged that the inflation numbers could have been higher given the significant depreciation of the Turkish Lira following the elections.
Additionally, Ash noted the importance of the role of the Central Bank in implementing appropriate policies in order to manage inflation.
Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.
The suppression of the lira stems from Erdogan’s core idea that economic growth can be hampered by raising interest rates.
Turkish President Recep Tayyip Erdogan has retained his seat after winning the past presidential election in the country and while this naturally calls for celebration, the outlook of the Lira is showcasing the industry’s perception of the victory. According to CNBC, the Turkish Lira was trading as low as 20.44 against the United States Dollar by 10 am local time.
The revelation that Erdogan will continue in power with his supposedly flawed economic and monetary policies has unsettled the economy and the reflection is being shown in the outlook of the lira. The country’s fiat has been receiving a lot of bearish projections from industry experts, many of whom do not expect any positive turnaround for the asset in the near future.
“We have a pretty pessimistic outlook on the Turkish Lira as a result of Erdogan retaining office after the election,” Wells Fargo’s Emerging Markets Economist and FX Strategist Brendan McKenna told CNBC’s “Squawk Box Asia”.
McKenna projected that by the end of this current quarter, the Lira can drop as low as 23 against the dollar. In the long term, he foresees mild growth as he believes the currency can retest 25 against USD by the first quarter of 2024.
The suppression of the lira stems from Erdogan’s core idea that economic growth can be hampered by raising interest rates. Rather than employ this route to curb inflation, the president believes increasing things like exports can prove to be more magical in addressing some of the core economic woes the country is facing.
Many countries and advanced economies are also seeing massive inflationary growth, however, the difference is in the approach to tackling this menace. The United States for instance has hiked its interest rates as many as 10 times since last year, and the impact is being felt at the inflationary level.
The fact that many world currencies have been recording significant devaluations in the past few years appears to be easing off the banter surrounding the Turkish Lira amongst critics. Nonetheless, the rate of devaluation in the currency is calling for relatively more drastic measures by the appropriate authorities.
One of these measures is the move by the Turkish Central Bank to secure currency reserve swap lines with countries in the Middle East and China. According to McKenna, if the apex bank “can continue to draw on those lines and possibly extend and enhance those reserve currency lines, maybe there’s some support in the central bank FX intervention”.
The new tenure is just shaping up and over the course of the next few months, there will be an indication of whether a change will come as it concerns the policies that can better place the economy and the Turkish Lira on a positive path for growth.
Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.
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Shiba Inu is in the spotlight in Turkey as that country’s Finance Minister confirmed exploratory efforts to allow widespread adoption.
Last week, the U.S. Bureau of Labor Statistics released data that showed the primary inflation gauge — the consumer price index — was up 7.9% for February, marking the highest level in 40 years and the 10th straight month it was higher than 5%.
While that’s a significant increase for Americans, it’s almost a rounding error compared to countries in the throes of runaway inflation. For instance, the country of Turkey has seen its inflation rate climb 191% from 2016 to 2022, according to InflationTools.com.
However, it’s reported that citizens of Turkey have been embracing cryptocurrencies as an inflation hedge. So much so that the Turkish government itself has seemed to soften its hardline opposition and crypto ban last year. In fact, that government is instead now exploring ways to embrace Shiba Inu as a currency.
The current currency crisis facing Turkey has been decades in the making resulting from trade imbalances, imposed tariffs and taxes against Turkish imports, as well as questionable domestic monetary policies by its lawmakers, which have all culminated in a beatdown of the Turkish lira over the years.
However, citizens in Turkey have embraced crypto — SHIB in particular — driving awareness and adoption of the token as a store of value and alternate method of exchange to the lira. It’s even gotten the attention of Turkey’s Finance Minister, who reportedly met with a Shiba Inu influencer to explore possibly expanding the token’s use and acceptance as a complementary form of currency. Details are sparse, and no one thus far has publicly linked SHIB with the phrase “legal tender” regarding the situation in Turkey. However, there are several recent developments across the Shiba Inu platform that are transforming it from a novelty token to a multi-function utility coin.
The dog-inspired SHIB token began as a joke in August 2020 then rocketed in value by more than 49,000,000% in 2021. To add to its legitimacy, SHIB developers have since expanded and built more value into its ecosystem by launching a decentralized exchange, non-fungible tokens (NFTs), and complementary cryptos with different use cases — namely its LEASH token, which holds value like a stablecoin, and the BONE governance token, which gives holders the right to vote on future initiatives and projects by SHIB developers. There’s also a SHIB-based blockchain being built — called Shibarium — to move the entire Shiba Inu platform off the Ethereum network.
We’ve found one company that’s positioned itself perfectly as a long-term picks-and-shovels solution for the broader crypto market — Bitcoin, Dogecoin, and all the others. In fact, you’ve probably used this company’s technology in the past few days, even if you’ve never had an account or even heard of the company before. That’s how prevalent it’s become.
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On top of all that, it has amassed an extremely loyal following of millions of supporters — SHIB’s official Twitter feed has 2.9 million subscribers — who refer to their collective as “ShibArmy.”
As of this writing, SHIB is priced at $0.00002162, down 1.5% over the past 24 hours, according to CoinMarketCap, and down 75% since it hit a record high of $0.00008845 in October 2021.
This is not financial advice. Investors should always do their own research and only invest what they can afford to lose. While we’ll have to see if Turkey adopts Shiba Inu as a type of currency, such a move would help legitimize a project that’s struggling to regain past momentum and returns.
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The Turkish lira slipped against Bitcoin, hovering around a two-month low after data showed annual inflation skyrocketed in February. The lira has lost about 12% against the world’s largest cryptocurrency this week, data from Coingecko shows.
The lira, currently trading at about 590,462 to Bitcoin, also lost about 7% to the dollar over the past week. Inflation accelerated at a record-high 54% in February, data from Tradingeconomics showed, while weekly volumes on BtcTurk, one of Turkey’s largest crypto exchanges, exceeded $2 billion.
Turkish inflation has skyrocketed since last year, largely due to President Tayyip Erdogan’s unorthodox stance on monetary policy, which saw the central bank cut interest rates despite rising prices. Surging inflation has played a key role in undermining Turkish financial stability, and has pushed its populace into guarding their wealth through crypto.
Last year, during a currency crisis that saw the lira plummet in value, trading on major Turkish exchanges had exceeded 1 million daily trades. That trend appears to have spilled over into this year, according to a report from The Financial Times.
While the use of crypto for payments is banned in Turkey, it is legal to invest in the space as a tradeable asset. Surging popularity of digital assets, coupled with a crash in a major exchange last year has also seen the government race to draft laws covering crypto. A recent report from blockchain research firm Chainalysis also showed the Turkey had the highest crypto transaction volumes in the Middle East.
Countries with high inflation and a weak currency have seen a surge in crypto adoption in recent years. Venezuela had turned to crypto, specifically Bitcoin and the country’s own token, Petro, after the bolivar crashed and the economy tanked in 2019. Chainalysis’ report also showed that emerging markets- countries that tend to face economic instability, were the biggest adopters of crypto in 2021, with Vietnam in the lead.
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The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
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Bitexen, the Turkey-based cryptocurrency exchange, has announced the listing of Shiba Inu (SHIB) token along with Sun (SUN), Celo (CELO), JUST (JST), Smooth Love Potion (SLP), and Moonbeam (GLMR), reports thecryptobasic.com. The listing of Shiba Inu on the Turkish Exchange has led to an increase in the number of holders for the Shiba Inu (SHIB) token and reached a record 1,155 573 holders. When going to press, Shiba Inu is trading at $0.00002152 per token, showing no change in its price for the day.
As per CMC’s data, the current market capitalization of $11,817,569,140 makes SHIB the 15th biggest cryptocurrency globally.
The canine-based meme coin is now listed in almost all major centralized exchanges, including Binance, Kraken, Crypto.com, Bitmart, except Robinhood. However, the coin holders are anxious about the listing on RobinhoodApp.
6 yeni #coin Bitexen’de!
$SHIB, $SUN, $CELO, $JST, $SLP ve $GLMR bugün 15.15’ten sonra Hızlı Al/Sat’ta listeleniyor. İster cepte, ister web’de, 150’den fazla #kripto para ile alım-satım yapma ayrıcalığı #Bitexen‘de!
https://t.co/IWxdcCSifo pic.twitter.com/Zm2s7Elfui
— Bitexen (@bitexencom) February 1, 2022
During the Q&A session held on January 27, the question was asked by one of the Shiba Inu community members to co-founder and CEO Vlad Tenev. He, however, did not give a straightforward answer. As a result, it is still unclear when the American no-commission investing platform will start listing new coins.
Bitexen is an online digital asset trading platform and has been locally developed by Turkish engineers. The exchange is also registered with the Istanbul Chamber of Commerce. It boasts support in trading with 150 plus cryptocurrencies on mobile and the web.
Launched on May 4, 2018, Bitexen has a daily trading volume of $85M and boasts a user base of 1 million. It is based in Istanbul, Turkey, and provides instant and pro trading features with customer support 24/7 available for fiat on-off ramps for Turkish Lira users. In addition, users can reportedly use native exchange token EXEN for lower fees and other privileges.
Disclaimer
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
About Author
Turkish media reports that authorities there are investigating an alleged Dogecoin mining scam that pulled the rug on investors after amassing $119 million worth of deposits.
An Aug. 23rd report from local channel TV100 broke the news, with police identifying pseudonymous online avatar “Turgut V.” as the scheme’s suspected operator.
Authorities believe that Turgut and 11 associates managed to gather close to 350 million Dogecoin valued at $119 million before disappearing.
Turgut reportedly solicited investments from 1,500 Turkish citizens, drumming up excitement for the Dogecoin “mining” operation at in-person networking events held at ritzy locations, and by using a Telegram group online. Investors were promised returns of 100% in 40 days and reportedly paid returns for around 3 months.
Investors were told that the Dogecoin they sent would procure new equipment to mine DOGE. Similar to Bitcoin, Dogecoins are created through Proof-of-Work mining, where network participants compete to validate transactions and produce the next block by computationally solving complex equations. The miner that solves the equation mines the network’s next block, also receiving all of the crypto contained within it as a reward.
The operation ran smoothly for its first three months, with early investors receiving their returns as promised. However, after the scheme’s total value locked (TVL) peaked at 350 million Dogecoin during its fourth month, the funds reportedly disappeared.
The Chief Public Prosecutor’s Office of the Turkish suburb Küçükçekmece is now carrying out an ongoing investigation to locate Turgut and his 11 associates. Authorities have issued an order restricting Turgut and his partner Gizem N. from traveling outside the country.
Related: Australians lost over $25 million to bogus crypto investments
The recently surging popularity of crypto assets in Turkey has brought with it an increase in scammers seeking to leverage digital assets to dupe victims out of their hard-earned cash.
At the end of April, Turkish authorities jailed six suspects associated with the collapse of local crypto exchange Thodex. The exchange had abruptly halted withdrawal services earlier that month, stranding users’ funds on the platform.
Also in April, four employees of the local Vebitcoin exchange were arrested for allegations of fraud just a day after Vebitcoin announced it would cease operations.
