The costs of Erdogan’s fight for Turkey’s ‘economic independence’

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Turkey’s consumer prices have soared by the highest rate since 2002, further undermining President Recep Tayyip Erdogan’s unorthodox battle for his developing country’s “economic independence”.

Analysts attribute the jump of the official reading to 36.1 percent last month to the surging cost of imports, which range from energy to many of the raw materials Turkey’s manufacturers turn into exports.

Those costs jumped because of a historic collapse of the lira, which last year lost 44 percent of its value against the dollar.

But ultimately, analysts blame both inflation and the lira crisis on Erdogan’s fervent belief that high interest rates cause inflation.

Conventional theory says the opposite is true because higher interest rates slow economic activity by making borrowing more expensive and providing incentives for people to keep their money in the bank.

Here is a summary of Turkey’s…

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