Why Turkish central bank independence matters

The Turkish government’s attacks on the central bank (CBRT) have become increasingly aggressive over the past month, raising fears about the independence of monetary policy and triggering a sharp sell-off in the lira. In this Watch, we explain how the CBRT’s independence was a pillar of Turkey’s economic success story in the 2000s and why an encroachment of the Bank’s independence could lead to more problems than the government has bargained for.