STORY: Uncertainties in U.S. economic policies add to strain on Turkish economy -- experts   
SHOOTING TIME: April 12, 2024
DATELINE: April 13, 2024
LENGTH: 00:02:04
LOCATION: ISTANBUL, Türkiye   
CATEGORY: ECONOMY

SHOTLIST:
1. various of Istanbul city in Türkiye
2. various of Murat Tufan, an analyst with Turkish broadcaster Ekoturk, in Istanbul, Türkiye
3. SOUNDBITE 1 (Turkish): MURAT TUFAN, Analyst with Turkish broadcaster Ekoturk
4. shot of Grand Bazaar in Istanbul, Türkiye
5. SOUNDBITE 2 (Turkish): MURAT TUFAN, Analyst with Turkish broadcaster Ekoturk
6. shot of Grand Bazaar in Istanbul, Türkiye
7. SOUNDBITE 3 (Turkish): MURAT TUFAN, Analyst with Turkish broadcaster Ekoturk
8. shot of Mehmet Ali Yildirimturk, a financial analyst in Istanbul, Türkiye
9. SOUNDBITE 4 (Turkish): MEHMET ALI YILDIRIMTURK, Financial analyst
10. shot of Grand Bazaar in Istanbul, Türkiye
11. SOUNDBITE 5 (Turkish): MEHMET ALI YILDIRIMTURK, Financial analyst

STORYLINE:

Uncertainties in U.S. monetary policy and high inflation in the United States are jointly intensifying pressure on Türkiye, whose economic prospects are already downbeat, said Murat Tufan, an analyst with Turkish broadcaster Ekoturk.

The U.S. Labor Department reported on Wednesday that consumer inflation in the United States accelerated to 3.5 percent in March from a year ago, up from 3.2 percent in February, signaling ongoing inflationary pressure.

Federal Reserve Chair Jerome Powell said on April 3 that they do not think it will be appropriate to lower the policy rate until there is greater confidence that inflation is steadily moving down towards 2 percent.

Türkiye's inflation soared to 68.50 percent in March while the Turkish lira has depreciated by 8.57 percent against the dollar in 2024 alone.

SOUNDBITE 1 (Turkish): MURAT TUFAN, Analyst with Turkish broadcaster Ekoturk
"Given Türkiye's 70 percent dependency on imports, the unfortunate reality is that the foreign trade deficit is reaching record levels due to the depreciation of the Turkish lira against the dollar."

"Amidst this delicate scenario, uncertainties in the U.S. economy, are exacerbating the strain on the country," Tufan said, particularly highlighting the Fed's "wrong" policies.

SOUNDBITE 2 (Turkish): MURAT TUFAN, Analyst with Turkish broadcaster Ekoturk
"This uncertainty is leading to a ripple effect in the markets: central banks dependent on the Fed are making incorrect decisions, and those intending to cut interest rates may end up raising them prematurely."

Tufan said what needs to be done is crystal clear.

SOUNDBITE 3 (Turkish): MURAT TUFAN, Analyst with Turkish broadcaster Ekoturk
"What needs to be done is crystal clear. Firstly, it's imperative to invigorate the domestic economy, prioritizing national interests. In the long term, nations like Türkiye must discern what to produce autonomously, aiming to diminish reliance on the dollar and strategically targeting key sectors through appropriate channels."

In Istanbul's Grand Bazaar, the cornerstone of Türkiye's free foreign exchange and gold market, serving as the primary influencer in determining prices, dealers eagerly awaited the announcement of the U.S. non-farm payroll data on April 5.

On Thursday, one gram of gold, the most favored investment instrument among Turks, stood at 2,429 Turkish liras (about 75.25 U.S. dollars). It was 2,350 liras (about 71.70 dollars) on the morning of April 5.

Mehmet Ali Yildirimturk, a financial analyst who also runs a website that streams live prices from the free foreign exchange and gold market, told Xinhua that the dependency on American data in this specific Grand Bazaar represents just one facet of a broader panorama.

SOUNDBITE 4 (Turkish): MEHMET ALI YILDIRIMTURK, Financial analyst
"Federal Reserve's decisions hold significant sway in Türkiye, much like they do across the globe. The interest rate hikes by the Fed are meticulously observed and exert a notable influence on the local markets."

Yildirimturk emphasized the urgency of promptly reducing Türkiye's dependency on the U.S. economy, citing the risks arising from instabilities and uncertainties in American policies.

SOUNDBITE 5 (Turkish): MEHMET ALI YILDIRIMTURK, Financial analyst
"It appears that the U.S. aims to reduce its inflation, but not to an excessive extent. That explains the prolonged delay in implementing an interest rate cut. Powell says: let's believe that we will reach the two percent target, then we will think about an interest rate cut."

Xinhua News Agency correspondents reporting from Istanbul, Türkiye.
(XHTV)