Political support for economic program remains strong, says Şimşek

ISTANBUL

Political support for the economic program is still strong, Finance Minister Mehmet Şimşek has said, reiterating that the essence of the program is disinflation.

“We do not foresee any significant deviations in the program. There will be temporary ups and downs, which is normal. However, we take our measures based on structural conditions rather than short-term fluctuations,” Şimşek said in a televised interview on April 29.

“Reducing inflation was our priority in the past and remains so today, regardless of domestic developments,” he added.

There has been limited deterioration in inflation expectations and a loss in the value of the Turkish lira, but the decline in oil prices is clearly disinflationary, the minister noted.

Financial conditions, which have been tightened, will bring inflation down, he said, adding: “We have no doubts regarding inflation.”

The minister voiced confidence that inflation will remain within the Central Bank’s target path.

There is a temporary risk of a slowdown in growth, but they are taking supply-side measures, Şimşek added.

“If the oil prices remain at their current level, they will reduce the current account deficit by $7-8 billion,” he also said.

The Central Bank’s gross reserves are currently enough, even though there has been some decline in the reserves amid the market volatility, according to Şimşek.

Ankara’s dialogue with the new U.S. administration is very strong, he also said.

“Due to good relations, they subjected us to the lowest customs tariff [of 10 percent]. This is a tremendous advantage for Türkiye,” Şimşek added.