Turkey’s Erdogan Ousts Central Bank Governor in Surprise Move

Turkey’s President Recep Tayyip Erdogan ousted the governor of the central bank late Friday in a surprise move that risks plunging the country into further economic turbulence.

Central bank governor Naci Agbal is the third central bank chief fired by Mr. Erdogan in less than two years as the country has weathered a series of economic and geopolitical crises.

Mr. Agbal was replaced by Sahap Kavcioglu, a former member of parliament from Mr. Erdogan’s Justice and Development Party and columnist for the pro-government newspaper Yeni Safak, according to a presidential decree published in Turkey’s official Gazette.

Since Mr. Agbal was appointed in November, the central bank raised interest rates significantly in an effort to fight inflation. Turkey’s central bank lifted its key rate to 15{f08ff3a0ad7db12f5b424ba38f473ff67b97b420df338baa81683bbacd458fca} from 10.25{f08ff3a0ad7db12f5b424ba38f473ff67b97b420df338baa81683bbacd458fca} in November, and followed that up with a move to 17{f08ff3a0ad7db12f5b424ba38f473ff67b97b420df338baa81683bbacd458fca} in December.

Those increases, and a follow-up Thursday that raised rates to 19{f08ff3a0ad7db12f5b424ba38f473ff67b97b420df338baa81683bbacd458fca}, were a response to a rapid rebound in economic activity in the second half of last year that left Turkey as the only member of the Group of 20 leading economies apart from China to record growth last year.