Turkey’s lira falls to an all-time low

Turkey’s currency crashed to a new all-time low against the dollar Friday, a day after the Central Bank again lowered a key interest rate despite surging consumer prices.

The lira’s fall prompted the Central Bank to intervene by selling off more foreign currency. It was the bank’s fifth intervention in recent weeks to attempt to prop up the lira.

The lira hit a new record low of 17.14 against the dollar before the bank intervened and the currency recovered some of its losses Friday. Still, it was around 5% weaker against the U.S. currency from Thursday’s close.

The Central Bank announced Thursday announced that it was cutting the key interest rate from 15% to 14% even though inflation is running at a staggering 21%. The bank has now slashed rates by 5 percentage points since September even as most other national banks have raised interest rates to ease high inflation.