Turkey Lets Lira Depreciate Faster to Avoid Sharper Fall, Central Bank Chief Says

Karahan's framing is a deliberate trade-off: a controlled, faster lira glide path is being presented as a way to pre-empt a disorderly adjustment, with the weaker growth backdrop cited as the reason the inflation pass-through is now more forgiving. The binding constraint is domestic savers — the whole strategy depends on lira assets staying attractive enough to prevent deposit flight, which is why the emphasis falls on a 'sustainable framework' rather than on any specific level. Whether the pass-through assumption holds if activity recovers, and whether the governor's remaining term provides continuity investors can price, are the open questions.