By Smartencyclopedia Newsroom *

In a significant move signaling a potential shift towards more conventional economic policies, Turkish President Recep Tayyip Erdogan has appointed a former bank executive based in the United States to lead Turkey’s central bank.

Hafize Gaye Erkan, a former co-CEO of the First Republic Bank and a Princeton-educated professional, has been named as the governor of the Turkish central bank, making her the first woman to hold this position.

Erdogan’s decision comes as the country grapples with a severe cost-of-living crisis exacerbated by skyrocketing inflation rates that reached an alarming 85% in October.

Critics attribute this turmoil to Erdogan’s strategy of lowering interest rates to stimulate growth, which contradicts the conventional economic approach that suggests raising rates to combat inflation.

The reappointment of Mehmet Simsek, a highly respected former banker, finance minister, and deputy prime minister, as the head of the finance and treasury ministry, further indicates a potential departure from the “unorthodox” policies that many economists have criticized.

Erkan’s extensive experience in the financial sector, including her roles as a managing director at Goldman Sachs and co-CEO of the now-defunct First Republic Bank, positions her as a suitable replacement for Sahap Kavcioglu, who oversaw a series of rate cuts during his tenure.

Kavcioglu, in turn, has been appointed to lead the country’s banking watchdog, the BBDK.

Source: With Agencies