Plunge in lira amplifies Turkey economy fears

Turkey's central bank has hiked its leading rate 50 basis points, but economists doubt whether even tighter monetary policy will halt the currency's declineTurks have over the past three months nervously watched the steady decline in value of the Turkish lira against the dollar, seeing it haemorrhage more than 10 percent in the past month alone. “The more the dollar increases, the less we do business here,” complained Mehmet Semih Ozdemir, looking for customers at his clothes stall at the Istanbul bazaar. The currency has been buffeted by fears over Turkey’s economic performance, with growth expected to have slowed in the third quarter this year and the high current account deficit a persistent risk factor.

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