Real Sector's Interest Rate Cut Demands and Contradictions in Economic Policies
In his article evaluating the real sector's demands for interest rate cuts, Çetin Ünsalan draws attention to the incompatibilities between inflation and interest rates.
In his written piece, Çetin Ünsalan discusses the contradictions between global evaluations at the Istanbul Economy Forum and Turkey's economic policies, the real sector's demands for interest rate cuts, and inflation data.
Diverging Economic Management at the Global Forum
Central bank officials from around the world gathered at the Istanbul Economy Forum to discuss the rise in inflation and its impact on interest rate decisions. While global participants pointed to similar justifications, Turkey's economic management diverged from this picture by claiming to be the only country that has reduced inflation amidst a wartime environment.
Contradiction Between Inflation and Interest Rates
Living with inflation rates manifold higher than what the world fears, the controversial nature of the figures, and ambiguities in interest policies create question marks. Despite this, the real sector's demand for interest rate cuts continues to persist.
ITO President Avdagiç's Demand for Interest Rate Cuts
Although Istanbul Chamber of Commerce President Şekib Avdagiç knows the economy and the real sector well, his demand for interest rate cuts without going into details and placing the burden entirely on banks is evaluated by the author as a performative demand.
Lending Mechanisms and the Situation of Banks
It is emphasized that banks' lending mechanisms have been restricted and left outside the scope of inflation accounting. Ignoring the amounts of interest paid and the risks makes discussing interest rates on their own meaningless.
Production Ecosystem and the Search for Financing
In an environment where the production ecosystem is damaged and the domestic market is locked up due to purchasing power, it is stated that low interest rates will not be useful for obtaining loans. The author points out that those seeking financing must present concrete projects.
Past Experiences and Solutions
It is stated that the high interest rate and cost crises of the recent past should not be forgotten. It is argued that ignoring all indicators and focusing solely on figures will bring consequences, and that problems should be discussed realistically rather than as election messages.