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Turks hammered by currency crisis

·3-min read

Turkish pensioner Abdullah Cici and his wife Hatice travelled across Istanbul to hunt for bargains at a popular bazaar.

They were disappointed.

"We need a lot of things but we cannot buy them. There's salami, sujuk (sausage) over there. I am a human. I also crave for them but I cannot afford," he said.

"Our salaries are now worth peanuts."

The price swings at the market offer a snapshot of the toll dealt on consumers by soaring inflation and a currency that has lost almost a third of its value against the dollar this year.

The lira sank to a record low on Thursday, 11.30 against the dollar, after the central bank apparently caved again to pressure from President Recep Tayyip Erdogan to cut interest rates for a third straight month.

Analysts blame most of Turkey's problems on unconventional economic policies that focus on economic growth at the price of high inflation and a depreciating currency.

Annual inflation has reached 20 percent, quadruple the government target.

The Cicis have had to adapt.

"We buy in small amounts, half a kilogramme instead of one," said Hatice Cici, holding a small bag of produce worth a total 120 lira ($10.78, 9.5 euros).

One loaf of fresh white bread costs 2.5 lira today compared to two lira a month ago. One kilo of mince meat is around 90 lira, up from 70 lira in October. Five kilos of oil have risen from 80 to 100 lira.

The net minimum wage is 2,825 lira, while unemployment is in the double digits.

Erdogan has blamed big supermarket chains for uncontrollable price increases.

"Erdogan is running the show," said Fawad Razaqzada, analyst at ThinkMarkets.

"If he wants lower interest rates he will get lower rates, regardless of how high inflation might be or how the economy is doing," Razaqzada said.

"It is very difficult to see the light at the end of the tunnel for the Turkish lira unfortunately."

Sellers shout "there's no price increase in our shop" at the bustling Eminonu shopping district in Istanbul.

But pensioner Naime has recorded the shifting prices in a notebook that she keeps in her bag.

"I calculate everything. I write down prices," she said.

"I cannot buy whatever I want. When I go to the market the second day, it's never the same price again," she said.

In the past she had money to spend and could go on holiday with her family.

"We cannot do any of that now and barely make ends meet."

- No more picnics -

Another retiree, Feriye, said she came to the bazaar to find a cheaper coat for her husband to spend the winter as she could not afford one she saw at a shopping mall.

"I earn a pension of 2,600 lira (200 euros). Tell me how come a coat costs 1,600 lira (120 euros)?" she said. "I don't know if I can find an affordable one here."

Hafzullah Canbay, a shuttle driver who was fishing on the Galata bridge near the bazaar, said policies have made the rich richer and the poor poorer.

"If you ask me what's the solution, let me put it clear, I have no expectation from any political party," he said.

"If you ask me whether I am hopeful, I am not. I cannot see the light."

Canbay said he used to picnic every weekend with his children.

"It's no longer possible," he said. "We have to live according to our calculations. That's our situation."


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