Economy in Turkey: Expert says swift exit from KKM (Currency Protected Accounts) not likely
An expert in economy has shared important opinions about “Currency Protected Accounts”, a major headache in Turkey’s economy at the moment. He noted a swift exit would not be likely at all and shared following:
“There is an exit in sight for the Savings Deposit Insurance Fund (KKM); however, it is not yet at a notably significant level.
In the four weeks from August 18th to September 15th, the KKM decreased by 102 billion Turkish Lira (TRY) and 4.4 billion US Dollars (USD). The rate of decrease was approximately 3% in TRY and 3.4% in USD.
Therefore, a 3% decrease is not to be taken lightly. The economic administration undoubtedly wants Turkey to completely exit the KKM over a certain period and is making efforts towards that goal. So far, the decrease can be considered as a minor step.
PEOPLE NEED TO BELIEVE EXCHANGE RATE WILL NOT RISE
As I mentioned earlier, the measures taken so far to reduce the KKM are aimed at convincing the public through banks. How successful banks can be in this regard is certainly challenging. The real convincing can only happen when people believe that the exchange rate will not rise, and they can achieve high returns in Turkish Lira. It is extremely difficult to reinforce the expectation that the exchange rate will not increase. (Excerpt from article by Alaattin Aktaş / Ekonomim)
