Erdoğan: Interest rates make the rich richer and the poor poorer

Turkish President Recep Tayyip Erdoğan on Friday called on citizens to convert their gold holdings to lira through new financial instruments introduced to shore up the currency.
"Let's not forget this: as long as we don't take our own money as a benchmark, we are doomed to sink. The Turkish Lira, our money, that is what we will go forward with. Not with this foreign currency, that foreign currency."

Addressing a business group, Erdoğan also called on Turks to bring their gold savings into the banking system and reiterated his view that interest rates were the cause of inflation.
"For some time, we have been waging the battle of saving the Turkish economy from the cycle of high-interest rates and high inflation, and taking it on the path of growth through investment, employment, production, exports and current account surplus," the president said.
"Interest rates down, interest rates up. My friends, let us please take this out of our books. Interest rates make the rich richer and the poor poorer."

On what he calls the "under-the mattress savings" of people who withdraw their assets from Turkish banks and keep them at home, he said as of the beginning of 2022, both companies and citizens "will accelerate the return to the lira."
"The more we bring back to our economy the 5,000 tons of gold kept under the mattress, the stronger our country and nation will be," the president added.
Touching on the recent fluctuations in foreign exchange rates, Erdoğan said measures are being taken to prevent sudden, harsh and unreasonable fluctuations.

The president also stressed the government has no problems on the budget side, adding: "We are closing the year with better realizations than anticipated."
On Wednesday, the Turkish Central Bank said it will give incentives to encourage people to shift from gold to lira deposits.
The move is part of ongoing efforts to prop up the Turkish lira.
According to analysts, the total amount in gold accounts currently stands at 270 billion liras ($22.4 billion), while the figure for accounts with a maturity of three months is around 15 billion liras ($1.2 billion).