Top level clash of opinion on Turkish economy deepening

The difference of opinion about Turkey's economic policies between the president and the government - and also within the government itself -  is deepening. 

After President Recep Tayyip Erdo?an?s statement last week demanding interest rate cuts, it was observed that the difference of opinion was not limited to monetary policies, but also spread to several main areas.

The Central Bank decided on the interest rate cut yesterday, but discussions will apparently continue. After Erdo?an?s statement, starting with Economy Minister Nihat Zeybekçi, a couple of cabinet ministers said a higher dose of interest rate cuts should be implemented.

After the cabinet meeting held at the presidential palace on Jan. 19, Deputy Prime Minister Bülent Ar?nç directly said that the cabinet "wants the Central Bank to cut interest rates.? However, at least Deputy Prime Minister Ali Babacan or Finance Minister Mehmet ?im?ek should instead have said, ?The Central Bank should decide itself.?

We don't know whether Babacan or ?im?ek spoke to Erdo?an as determinedly as they speak to the public, but they have continued to give messages that the Central Bank should be independent.

The differences of opinion on the Central Bank?s independence and interest rates will not come to an end with this latest decision, because Babacan and the Central Bank insist on making cautious decisions on interest rates depending on developments in the global economy, maintaining economic stability and looking out for equilibriums. On the other hand, President Erdo?an and the cabinet ministers who repeat whatever he says constantly reiterate that there should be interest rate cuts absolutely and rapidly.

The impression in the public is that regardless of how...