Erdogan announces new Turkey measures to halt dollarisation, defends low-rates policy

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Turkish President Tayyip Erdogan addresses the audience as he attends a ceremony in Istanbul, Turkey, December 19, 2021. Murat Cetinmuhurdar/Presidential Press Office/Handout via REUTERS

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ANKARA, Dec 20 (Reuters) - Turkish President Tayyip Erdogan introduced a series of measures that aimed to prevent further dollarisation and encourage savings to be made in lira, as he repeated a defence of his low-rates policy, even as the lira crashed to record lows.

Speaking after a cabinet meeting, Erdogan said the measures would ensure citizens would not have to convert their lira into foreign currency, while implementing other measures to aid exporters and pensioners.

He said there would be "no turning back" from the new model based on low interest rates, adding the central bank's interest rate cuts would bring a fall in inflation - currently above 21% - "within months". He repeated that the fluctuations in exchange rates and prices were not based on economic fundamentals.

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Reporting by Tuvan Gumrukcu and Ece Toksabay

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