How will the Turkish economy be affected by the FED’s high interest rate policy?

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According to an analysis released today by the British Reuters news agency, developing countries are in the position of the most vulnerable economies under the long-term high interest rate policy signaled by US Federal Reserve Chairman Jerome Powell last week.

In the news, it is reminded that the New York-based financial analysis company S&P Global has classified the lending risk of financial institutions in Turkey, South Africa and Argentina as high or very high.

Eswar Prasad, Professor of Economics at Cornell University, said: “Fed increasing interest rates and keeping[rates]high will damage borderline economies like Sri Lanka and Turkey.” says and adds:

“In a two to three year time frame, things will start to get difficult… If it is certain that the Fed will keep interest rates high for a long time, the pressures can be felt immediately.”

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