Turkey's central bank intervenes to support lira

AP News
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Posted: Jan 23, 2014 5:53 AM

ANKARA, Turkey (AP) — Turkey's central Bank has intervened in the foreign exchange markets to support the lira, which dropped to a new low.

A brief statement from the central bank said Thursday that it was intervening in the markets due to "unhealthy price occurrences." It did not give further details.

Earlier, the lira dropped to an all-time low of 2.28 against the dollar before recovering to 2.26 following the central bank's intervention.

The Turkish currency has been falling steadily amid concerns that a bribery and corruption scandal that has ensnared people close to Prime Minister Recep Tayyip Erdogan might destabilize the government.

This week, the central bank decided against supporting the Turkish lira with an interest rate increase, a decision some analysts said was taken under pressure from the government.