The Turkish lira crashed as much as 7% in just a few minutes to a new record near 15 to the dollar on Monday, gripped by worries over President Tayyip Erdogan's risky new economic policy and prospects of another interest rate cut on Thursday.
The sudden slide left the currency with half the value that it had at the end of last year, fuelling inflation in a big emerging market economy which depends heavily on imports.
The lira slid as far as 14.99 against the U.S. currency in thin market liquidity, from Friday's close of 13.889. By 0815 GMT, it had trimmed losses in volatile trading and stood at 14.44. However, there was scepticism about whether the bank would go through with it given the volatility, Reuters reported.
Late on Friday, ratings agency S&P affirmed Turkey's long-term foreign currency rating at "B+" and revised its outlook to negative on an uncertain policy direction amid rising external risks.
Erdogan has repeatedly advocated for the rate cuts as he promotes a new economic plan prioritising economic growth, credit, production and exports, despite widespread criticism of the policy from economists and opposition politicians.
