Turkish Lira Slips Despite Appointment of Well-Regarded Finance Minister 

People walk in the Egyptian Bazaar, in Istanbul, Türkiye, Tuesday, May 30, 2023. (AP)
People walk in the Egyptian Bazaar, in Istanbul, Türkiye, Tuesday, May 30, 2023. (AP)
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Turkish Lira Slips Despite Appointment of Well-Regarded Finance Minister 

People walk in the Egyptian Bazaar, in Istanbul, Türkiye, Tuesday, May 30, 2023. (AP)
People walk in the Egyptian Bazaar, in Istanbul, Türkiye, Tuesday, May 30, 2023. (AP)

Türkiye's lira slid almost 1% on Monday in thin trading during the Asian day to weaken past 21 per dollar, in a shaky initial reaction to the appointment of highly-regarded Mehmet Simsek as finance minister.

The lira hit 21.1 to the dollar, not far above a record low of 21.8 made last week.

Simsek, 56, won markets' confidence during terms as finance minister and deputy prime minister between 2009 and 2018. He said on Sunday the country has no choice but to return to "rational ground".

His appointment is seen as a signal that President Recep Tayyip Erdogan's newly-elected government is moving away from unorthodox interest rate cuts in the face of high inflation that sent the lira on a long decline.

"The hope is that he (Simsek) could instigate much-needed economic orthodoxy and engage with the market more effectively," said Mohammed Elmi, senior portfolio manager for emerging markets fixed income at Federated Hermes.

Türkiye's annual consumer price inflation hit a 24-year peak beyond 85% last year, and stood at 44% in April in a sign that further monetary tightening was required, according to Elmi.

"A simple return to credible economic policy could see a marked change in Turkey's investment appeal," he said.

"The long-term outlook for Türkiye is still very much a positive one ... a young population, a burgeoning middle class, and a country that occupies a key strategic location, it has a number of factors in its favor."



German Economy Minister Says EU Open for Talks on China Tariffs

German Vice Chancellor and Economy Minister Robert Habeck poses for pictures alongside National Development and Reform Commission (NDRC) Chairman Zheng Shanjie following the opening session of the German-Chinese Climate and Transformation Dialogue in Beijing, China June 22, 2024. REUTERS/Maria... Purchase Licensing Rights
German Vice Chancellor and Economy Minister Robert Habeck poses for pictures alongside National Development and Reform Commission (NDRC) Chairman Zheng Shanjie following the opening session of the German-Chinese Climate and Transformation Dialogue in Beijing, China June 22, 2024. REUTERS/Maria... Purchase Licensing Rights
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German Economy Minister Says EU Open for Talks on China Tariffs

German Vice Chancellor and Economy Minister Robert Habeck poses for pictures alongside National Development and Reform Commission (NDRC) Chairman Zheng Shanjie following the opening session of the German-Chinese Climate and Transformation Dialogue in Beijing, China June 22, 2024. REUTERS/Maria... Purchase Licensing Rights
German Vice Chancellor and Economy Minister Robert Habeck poses for pictures alongside National Development and Reform Commission (NDRC) Chairman Zheng Shanjie following the opening session of the German-Chinese Climate and Transformation Dialogue in Beijing, China June 22, 2024. REUTERS/Maria... Purchase Licensing Rights

Germany's Economy Minister Robert Habeck said during his visit to China on Saturday that the European Union's door is open for discussions regarding EU tariffs on Chinese exports.

"What I suggested to my Chinese partners today is that the doors are open for discussions and I hope that this message was heard," he said in his first statement in Shanghai, after meetings with Chinese officials in Beijing, Reuters reported.

Habeck's visit is the first by a senior European official since Brussels proposed hefty duties on imports of Chinese-made electric vehicles (EVs) to combat what the EU considers excessive subsidies.

Habeck said there is time for a dialogue between the EU and China on tariff issues before the duties come into full effect in November and that he believes in open markets but that markets require a level playing field.

Proven subsidies that are intended to increase the export advantages of companies can't be accepted, the minister said.

Another point of tension between Beijing and Berlin is China's support for Russia in its war in Ukraine. Habeck noted Chinese trade with Russia increased more than 40% last year.

Habeck said he had told Chinese officials that this was taking a toll on their economic relationship. "Circumventions of the sanctions imposed on Russia are not acceptable," he said, adding that technical goods produced in Europe should not end up on the battlefield via other countries.