ANKARA: President Recep Tayyip Erdogan urged Turks on Friday to convert their foreign currencies into gold and lira to stimulate the country’s economy as the lira continued its slide against the dollar.

“For those who have foreign currencies under the pillow, come change this to gold, come change this to TL (Turkish lira). Let the lira win greater value.

Let gold win greater value,” he said during a televised speech in Ankara.

“What necessity is there to let foreign currency have greater value?” he asked.

However, as he delivered his speech, the lira lost value against the US dollar, reaching lows of 3.51.

After his address, it was trading at 3.55 against the greenback, a loss of over 1.5 per cent in value on the day. In November alone, the lira haemorrhaged more than 10pc against the dollar.

He also suggested that there were forces “playing games” against Turkey, which Turks could counter by changing their money. He did not say whom he was referring to.

“Don’t worry, in a short while, we will destroy this game.” The Turkish currency was also reacting to Erdogan’s repeated insistence on lowering interest rates because, he claims, there is “no other remedy”.

He referred to the United States, Japan and Europe as examples of where rates are low and questioned why Turkey still had such high rates.

After several months this year of rate cuts, the central bank stepped in with an unexpected hike of 50 basis points in its leading rate last month.

But concerns over Turkey’s political instability, including the government’s race to expand Erdogan’s powers, as well as its cracking relationship with the European Union meant a rally in the lira was shortlived after the bank’s announcement.

Worries over Erdogan’s influence grew after Prime Minister Binali Yildirim said on Thursday the government would bring a bill to parliament next week which proposes to change the constitution and give greater powers to the president.

Published in Dawn, December 3rd, 2016