Turkey’s new central bank chief seen as interest rate dove

Turkey’s central bank governor Murat Cetinkaya. (Reuters)

• Uysal has a degree in economics and a postgraduate degree in banking. He earned his master’s in inflation targeting in Turkey and in the world. He was born in 1971

ANKARA: Turkey’s new central bank governor Murat Uysal, who served as deputy governor for three years before the shock dismissal of his boss, is known as one of the more dovish members of the bank’s interest rate setters.
He has less than three weeks to prepare for the next rate-setting meeting, under pressure from President Tayyip Erdogan’s calls for lower rates to kick-start an economy in recession.
A fall in inflation last month had added to expectations of a rate cut on July 25, but likely US sanctions over Turkey’s purchase of Russian air defense systems, combined with investor jitters over Erdogan’s sacking of the bank governor, could put the lira under renewed pressure and make it harder to cut rates.
Economists and bankers say Uysal has been one of the more dovish members of the Central Bank’s Monetary Policy Committee, describing his views on interest rates as closer to the Turkish president than the previous governor.
“We know that Uysal is more sympathetic about a rate cut than (former governor Murat) Cetinkaya, and that’s why he has been appointed as the central bank governor,” said a senior Turkish banker who predicted a significant rate cut.
Uysal has worked in banking for two decades, holding several senior positions at the majority state-owned Halkbank and its subsidiaries. Bankers say he was respected for his trading in foreign exchange, government debt and derivatives.
“Uysal is on top of money and forex markets. He knows how to read the pulse of markets. He knows the mechanisms of banking and central banking,” a senior Turkish official said.
However, some point to his relative inexperience of monetary policy. “He is not a proper economist, rather a banker,” said one Turkish economist who asked not to be named. “My hunch is that his knowledge of monetary policy has been obtained through ‘on the job training’ as deputy governor.”
The Central Bank said on Saturday Uysal would fully communicate how the bank plans to attain “price stability and financial stability.”
“He will prefer much more frequent communication with markets,” the Turkish official said. “He will be able to explain himself and the central bank policies to the markets and the public effectively.”
Another economic source said Uysal’s communication skills “will stand out,” as he tackles market perceptions that he was appointed to do what the president wants, adding however: “It’s no secret that he defends low rates.”
Uysal has a degree in economics and a postgraduate degree in banking. He earned his master’s in inflation targeting in Turkey and in the world. He was born in 1971.