Turkey’s central banking voted on Thursday to reduce its one-week repo rates to 14%, from 15%.

The inflation rate in Turkey, a country with 84 million inhabitants is currently at over 21%. This has been rising steadily since President Recep Tayyip Erdan has not raised rates. It has meant that the purchasing power of Turks who earn local wages has plummeted. This is the The liraIt has been devalued by 50% in comparison to the dollarTo date, year

Economists and investors have been begging Erdogan for a reversal of course. But Erdogan has so far stuck to the unusual belief that higher interest rates actually worsen inflation, instead of cooling it. This is a widely recognized economic principle.

This move comes after a string of rate reductions by the central bank. Markets see this as an attempt to separate Erdogan from Erdogan who called interest rates “the Mother of All Evil.”

Turkey’s central banks previously said that they would be intervening in the currency market directly Monday. They will sell dollars to help the lira. However, experts doubt this strategy will work due to Turkey’s already small FX reserves.

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