Top critical issues waiting for Turkey’s new Central Bank Governor Gaye Erkan

The decision on the appointment of Hafize Gaye Erkan, who has been named as the Central Bank Governor for a long time, was published in the Official Gazette. Erkan, the 41-year-old first female president of the CBRT, will have 3 critical issues on her agenda.

After Mehmet Şimşek was appointed to the Ministry of Treasury and Finance, his first appointment in economic management was made to the Central Bank. Hafize Gaye Erkan, whose name has been mentioned for a long time, was brought in for this task. Erkan, who is also the first female president at the Central Bank, has expertise in banking, investment, risk management, technology and digital innovation and also serves on the Advisory Council of the Department of Operations Research and Financial Engineering at Princeton University.

Şahap Kavcıoğlu, who held the post of Central Bank Governor before Erkan, was appointed Chairman of the Banking Regulation and Supervision Board. Kavcioglu has held the post of Central Bank Governor for 27 months. He was the 26th President and that was the longest presidency lasting 7 years

NEW GOVERNOR TO DEAL WITH THREE MAIN PROBLEMS

When she takes the chair of the Central Bank, ERKAN will deal with three main problems: Exchange Rate Protected Deposits, interest rates and reserves. The Bank’s reserves, which were rapidly melting during the period when the exchange rate was under pressure, had finally decreased by $ 1.3 billion to -5 billion 697 million in the week of June 2.

The deposit size, which has reached $ 121.6 billion in Exchange Rate Protected Deposits, will be one of the main areas of activity not only for Treasury and Finance Minister Mehmet Şimşek, but also for Central Bank Governor Hafize Gaye Erkan.

Another issue will be the Central Bank interest rate, which was at 19 percent in September 2021 and has declined to 8.5 percent today. There are expectations in the markets for an extraordinary meeting of the new economic management and the Central Bank Governor without waiting for the Monetary Policy Board meeting on June 22.