The Turkish lira is already facing some of the most volatile conditions across global currency markets. Now, the nation is well into the presidential elections, with traders predicting a likely collapse if incumbent Recep Tayyip Erdogan retains his presidency.
Turkey is holding both its presidential and parliamentary elections. In the event of a victory by Erdogan, it’s “highly likely the Turkish lira collapses within months,” the founder of advisory firm Cribstone Strategic Macro Mike Harris stated.
The lira is currently trading at record lows of 19.56 against the U.S dollar, and market watchers forecast that it still has further room to plunge.
Turkey’s monetary policy prioritizes the pursuit of growth and export competition rather than assuaging inflation. Erdogan endorses the unconventional view that raising interest rates increases inflation, rather than taming it.